Almost nearly every single successful Google products were either developed out of research or out of 20%, or via acquisition. Most in-house business projects don't end up successful (Google Plus?) A big company has to invest heavily in R&D to push the limit. You just need one big idea that works and become a game changer.

At Google most in-house projects are infrastructural, and if you look at the scale at which they run and the fact that there's basically nothing that even comes close, they are wildly successful. You could also say Android was in-house, because what they bought is not at all what they ended up shipping. What they bought looked like a Blackberry rip-off, what they ended up shipping was an iPhone rip-off. And let us not forget Ads, the in-house system that has dominated online advertising for a decade now.

But I kind of fail to see what any of this has to do with Microsoft. :-)