Horace Dediu of asymco with a spot-on analysis of why Eric Schmidt had to go:
Cracks in strategy are hard to spot. One hint is that most of Google’s R&D efforts are defensive. Building browsers and mobile operating systems are methods to ensure they have distribution of search to as many screens as possible. These are expensive means to ensure channels are available for distribution. Expensive not only in terms of engineering costs but also in terms of relationships and opportunity costs.
But even a defensive posture is not sufficient for management change. What I think is the most serious failure is that for the past five years Google has not addressed the possibility of search itself becoming commoditized. Social media and app economies are asymmetric to search. They make money in different ways and appear to be less efficient or effective means to reach users, but they are growing. Facebook has overtaken Google in terms of page views and apps are a new interaction model for cloud-based content that does away with the indexing model Google champions.
The real condemnation of the leadership at Google is that there has been a failure to create entirely new disruptions.