“The mistake Larry and Sergey made is…”
They made a mistake? Take into account Google Search is not a success because it made a profit. You talk on Google’s success as if we’re telling the story of Google Search as an equivalent to Google Ads. It is undeniable that both Google Search and Google Ads are a design success, as well as they are an engineering success. But they are more a success as a service perspective than a product’s one. For that reason I think you may consider Google more a service provider than a product manufacturer (unlike Apple).
Making the Google Search/Google Ads distinction is important because it defines what success means. Google Search gets the users, because provides a service that is useful, fast, intuitive and easy to use. Google Ads is successful because provides a robust infrastructure to make the first profitable. And then, you get into Google’s other successes (is not just Google Search) like Gmail and Google Maps. Of course, they don’t make as much money as Google Ads, but does that make them less valuable products because of that?
If you look at Gmail and Google Maps success, its because of its engineering prowess, how it was built to scale. That’s what Larry and Sergey got right and what they mostly aim at all the time.
Then there’s the topic of Darwinism. There are multiple positions you can put yourself when designing a product. For instance, you can be either innovative or conservative. Apple is successful on the conservative lane of product design, meaning they don’t develop “new” products but instead aim at providing the right design for existing ones at the right moment. They are at the front and lead in whatever they do, and they focus on this. But they don’t try to make new fantastic stuff. That approach is artificial, it observes the evolution and makes the best intelligent decisions on what to do next.