Does anyone else find it stunning to see how badly Microsoft has stumbled over the past few years? It is absolutely amazing that the board hasn't thrown Ballmer out. Honestly, I think the last thing Microsoft needs to worry about is ancillary devices like tablets, media players, phones, etc. They need to focus on their core competencies, specifically Office, Windows and IT Enterprise.
Office, without a doubt is struggling. Competitors like OpenOffice.org offer a viable alternative free of charge. Since the advent of the much-maligned ribbon interface in Office 2007 and yet another change to file formats, many businesses have been reluctant to upgrade to the latest versions. Each new version introduces ever more superfluous features, with little to no focus on refinement or stability enhancements. Most customers that buy Office today don't do so because they necessarily want it, but have to have it to maintain compatibility. There was a time when Office was the defacto standard. Now many people question whether they need it - or at the very least wonder if they can just stick with their old copy of 97/2000/2003.
On the Windows side, one might argue that Windows 7 is very good release of Windows. Although I agree, I just don't see the "gotta have it" factor or killer app over Windows XP. I suppose DX11 support may be compelling for gamers, but in all honesty, has it improved enough to warrant the difference in footprint or efficiency? I'm not sure it is - particularly as a corporate customer. Sure, we'll upgrade eventually, but it will mean lots of training for our customers, hardware upgrades and not to mention an incredible amount of effort. One has to wonder if the ends justify the means. I'm sure we're not the only company thinking like that.
Although Microsoft is still without a doubt the biggest player in the Enterprise market, so many others are nipping at their heels. Linux and open source alternatives like MySQL are making headway into the data center. Newer MS technologies like Active Directory have been all but stagnant since their release. Windows Server is refined in each new version, but it hasn't really changed all that much from Windows 2000 (aside from the obligatory code bloat). For those IT folks who are reading this incredulously - think about the difference between NT4 Server and Windows 2000. When was the last time you saw Microsoft release such a compelling upgrade in a new product iteration? The answer is that there really hasn't been one. Each new version of Microsoft's Enterprise products like Exchange, SQL, SMS/SCCM and others have been largely evolutionary, not revolutionary.
Microsoft can do so much more, but instead they seem to be content to branch out into these miscellaneous markets that are not core competencies for them. And the more they're distracted by things like Zune, XBOX, Kin, Tablets, Windows Mobile Phone 7 (or whatever they're calling it now), the more they seem to lose ground in their core markets.
I'm not trying to be a Mac fanboy here. Sure, I like Apple products, but my livelihood revolves around Microsoft. At the end of the day, it is of benefit to see them flourish - but looking back over the course of the last decade, I have to wonder if Microsoft has what it takes to compete in the long run.