Phillip Greenspun is one of several people who speculates that Google will need to build a web-based Office product to compete with Microsoft.
Seems unlikely to me. What expertise does Google have in an office product? This is way outside of their core competencies. Nothing do to with information retrieval, very little innovation.
So how can Google grow? How can it support it's lofty $30-50B valuation? Google needs to focus on its strengths, innovative new products to enter new markets and a web advertising revolution to drive revenue.