Having Google enter your space must be one of the most crushing things that can happen to a small company. The feeling these guys felt when they saw the announcement must have been mortifying. Even if you have a superior product, like LiveNinja says they have, Google will outmarket you by so many orders of magnitude you just disappear into nothingness.
That's a terrible way to think. Drew Houston knew Microsoft and Google were already in the midst of building competitors when he applied Dropbox to YC.
I hope fellow entrepreneurs dont ever get discouraged when they see larger companies follow them on the same trail. It means they are on the right track more than anything else.
Dropbox didnt get discouraged and neither should any other startup.
Are there a lot of products where Google's forced out the competition? All I can think of are search, maps, and webmail (a long time ago) and web analytics (closely coupled to their core business).
The rest of the stuff I can think of is either competing but not dominant (phone OSes, browsers), or bought as a winner (doubleclick, youtube). They don't seem to have honed their Microsoft-ish emulate-and-destroy skills.
He's probably not bluffing that Google moving into your space is a good thing for your company.
Also google reimplementing somebody's working business is one of the most evil things I can think of in IT.
Google has pretty much unlimited resources and an army of bored overqualified engineers. They can literally take any successful online business, implement it themselves, and push it forward with their search engine.
Having Google enter your space must be one of the most crushing things that can happen to a small company. The feeling these guys felt when they saw the announcement must have been mortifying. Even if you have a superior product, like LiveNinja says they have, Google will outmarket you by so many orders of magnitude you just disappear into nothingness.