Google's taken a lot of hits recently. Their spectacular second-quarter results were overshadowed by confusion and talk of tougher comparisons in third quarter, and the stock dropped. Yahoo announced that their search index is now twice as large as Google's. Microsoft released a pretty capable copy of Google Maps. Google's debut on Current TV has been bland and disappointing. Google's also made a series of PR gaffes recently, like blacklisting CNET reporters over a mildly embarassing article. And the stock has dropped more, now down 12% from its peak.

So is that it? Google may be incredibly profitable, but they've grown too big, too fast and can't hold it together, while their competitors are relentlessly whittling away at Google's innovation lead?

Google's been pretty quiet recently, but I wouldn't count them out yet. There are many difficult problems that Google is ideally positioned to solve -- and to profit from.

Remember Google's language translation initiative? It still hasn't been released to the public, and when it is, it could put a lot of distance between Google and the nearest competitor for years. The ability to reliably communicate across language barriers will be huge.

Don't forget the Web Accelerator and Google TV, or the revamp of AdWords which should deliver a further increase in monetization. And when Google is added to the S&P 500 index, the stock should get a nice bump.

I expect to see a series of leapfrog events among Microsoft, Yahoo and Google where they one-up each other. But I also expect there will be a couple earthquake releases this year where Google takes a quantum leap ahead of the competition, giving them some competitive breathing room.

With the stock in the $280 range now, down from $317, it's starting to get interesting. If you're going to buy low and sell high, you can't wait for the earthquake to buy in -- you've got to recognize an opportunity where others see danger.