To conform or to confront?

Cringely seems to suggest Google and Microsoft should not be rivals, or maybe just stay in where they are now. Especially for Google, “…yet of those thousands of ideas, the company can really invest in only a dozen per year, leading the dissatisfaction and defections as the best nerds leave to pursue their dreams.” This idea seems opposite to the common sense of big companies' strategy: come up more ideas and more competitive goods to bit the rivals and maximize the profits. Is it related to the Industrial Organization Framework in HMF that different strategies are used in different market structures? If so, it's interested that how the company position itself. Maybe Google positions itself as a great competitor of Microsoft, so it tries to take over the market in this case. Is it right to have such passion or set up the goal to compete with the Microsoft and enter the monopoly market structure? However, the desire to become the best or the only is also the drive to success (success in current business world's definition, not mine). What should a company make its strategy under the oligopoly or monopoly structure? To conform, or to confront?

Like the news on Yahoo homepage: Walmart's new strategy. It's definately not good for smaller business, but is it really good to the consumer for the long run (short run of course is good because of the lower price)?