Google's mission is to rule the internet, by just improving their search engine they won't be able to do that, therefore it's important that they come with new products or else acquire start ups in order to dominate and have a upper hand in the internet space.
No company can become big by focussing on just one product, it's a combination of popular products that make a company popular. for microsoft it's OS, office, internet explorer etc.
For google its only their search engine and adwords, gmail, analytics and other products may follow.
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