Google's ascendancy is a back-to-the-future throwback to an earlier Silicon Valley, when companies built businesses on solid technological advances before going public.
Intel in the 1970s, Apple Computer and Sun Microsystems in the 1980s and Oracle and Cisco Systems in the 1990s illustrated the Valley formula of seizing lucrative markets with a compelling technological package and posting profits consistently.
That formula was abandoned in the mid-1990s with the launching of thousands of dotcoms that went public before they were profitable -- and then mostly crashed and burned. But Google, in the tradition of other great companies that started here, has scientists with advanced technical degrees and idiosyncratic ideas about how to run a business.
Balancing act
Schmidt, a former executive at Sun Microsystems, is a low-key computer scientist who must discipline Google's flamboyant, self-indulgent culture, without wringing out the genius.
When Edward Zander, Sun's former president, first visited Schmidt at Google not long ago, he was stunned. "I found dogs running through the halls, a piano in the lobby and all these food goodies around," he said. "I'm thinking to myself, 'It's like chaos here.'"
Indeed, it seems that there is nothing normal about Google's corporate routine.
Not long after arriving at the company in 2001, Schmidt found that he was contending with a squatter in his office.
One of Google's top engineers, Amit J. Patel, who was sharing space with five others in Google's chronically crowded quarters, decided that he could find relative solitude in Schmidt's tiny, 8-by-12-foot office. The chief executive would travel and attend meetings often, Patel reasoned, offering privacy during the intervals.
When Patel sought permission, Schmidt turned the decision over to his vice president for engineering, hoping that the request would be denied.
It wasn't.
"We were trying to drive home the point that we needed more office space," said Wayne Rosing, the vice president, a veteran of Apple and Sun.
Schmidt got the point. In an example of Google's eccentric culture, he let Patel share his office for several months. He now says that there was an upside to the odd arrangement: Patel is a master data miner, and Schmidt soon had instant access to better revenue figures than did his financial planners. (Ultimately, the company expanded to a fourth building.)
With its recent explosion as a business, Google has ignited a scramble for position in what was once a niche overshadowed by ad-heavy portals, Web sites that offer full menus of online services and digital content.
The shift to the supremacy of search engines indicates how swiftly business realities can change in Internet commerce. Giant portals have long tried to fence in Web surfers and keep them pacified. Google is exploding that strategy by taking advantage of the basic strength of the Internet: The ability to go instantly from one place to any other at no cost beyond the basic connection.
Microsoft has taken notice of Google and is improving the Web search engine that powers its MSN site.
"We see Google as a competitor with their search services," said Lisa Gurry, a product manager at MSN.
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