The funny part is that they might be actually emulating an entire marketplace entirely within one company, but it often seems like it's a marketplace where a large entrenched lowest common denominator is the option that everyone uses and dislikes.
Google needs to pick one, no doubt, but I wonder how relevant it is that they do (Android has much of its market share outside the US).
That said, saying "Google's startups-within-a-big-company strategy has driven most users outside of Google's chat ecosystem entirely" isn't a whole lot better.
WhatsApp is free SMS, from and to anywhere. It's an attractive offer for most of the world.
I know of several other prominent examples, but can't mention by name because I'd be breaking an NDA.
Also, Fuchsia is a successor, not a competing project, strictly speaking. It would be the "gauntlet" scenario if Google was running multiple ongoing projects all competing to "inherit" Android (which quite possible it does...)
If you look at the industry as a whole products wax and wane based on market trends. Market leading products often struggle to innovate under the weight of their own success and are eventually replaced by a new innovator that's doing something right.
Google, by virtue of creating many different types of products in one category somewhat insulates themselves from this effect. They have effectively infinite money, so from their perspective they can somewhat emulate the greater market internally. They can let "startup" style teams form internally so if someone supplants one of Google's products, it's likely to be a Google team.
There are significant downsides to this (eroding consumer trust) which may take their toll on Google with time.