What other options did Google have in this scenario? Being a software and data-focused company, they clearly were not positioned well to build and ship handset

What other options did Google have in this scenario? Being a software and data-focused company, they clearly were not positioned well to build and ship handsets. Google's best option is to ensure to ensure that their services (search, Docs, Maps, etc.) are the best available options. They were able to unseat Yahoo earlier in the decade due to quality of results, they just need to continue innovating and convince users to do the same again.