Apparently to address investor and analyst concern about some of the ways Google (News - Alert) is investing development funds, Larry Page, Google CEO, pointed out that “when we started doing search people thought we were crazy,” Page said. 

Page says all Google products into three categories:

• Search ads and ad products.
• Products with high consumer success like YouTube, Android (News - Alert), and Chrome.
• New products like Google+ and Google’s local and “Offers” efforts.

How some of these initiatives will be monetized is a reasonable question: many highly-used applications, including search itself and social networks of all types have initially gained traction without an obvious and clear revenue model. 

Page argued that the toggling between the three (highly profitable and big revenue streams such as search products and speculative apps such as Google+) is a precarious balance between short term and long term. But the eventual goal is creation of services that people “use twice a day, like a toothbrush.”  

“We’re careful stewards of shareholder money,” he said. Page avoided discussion of some of the more-exotic investments. 

We have tremendous new businesses being viewed as “crazy,” he noted. In the past, the launch of the Chrome browser and operating system, as well as Android, have been criticized, for example, though people do not tend to see those investments as they might the “space” or “energy” investments Google has made. 

Talking about the Chrome browser and Android operating system, Page noted that “people rightly ask how we will monetize these businesses.” 

“Our emerging high-usage products can generate huge new businesses for Google in the long run, just like search. And we have tons of experience monetizing successful products over time,” he said.

Google has more failures than successes, one might rightly argue. But that's the nature of Internet innovation. Firms that make more mistakes, and experience more failures, arguably get to the winners at a faster rate, one might argue. The trick is to avoid “betting the farm” when doing so. 

But “luck,” or serendipity, can play a role as well. Some would argue that Google's AdWords actually uncovered a form of auction economists had not typically thought about.

Some think however, that Google's innovation model might not generally work for other firms.

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