All of the internal issues wouldn't be a huge problem if consumers wanted to buy their products, but they just don't know how to tell a compelling story of improving lives. Microsoft just launches products that they think will compete well in certain sectors, but they're not really thinking about what people need. The XBox is really the only counterexample from the whole past decade! "Hey, we have this thing that plays games, but you can also get updates and games online using our store. When's the last time you've been able to apply a bugfix to your console game?" Show me another Microsoft consumer product that really improves someone's life like the XBox did
Sorry, but many companies are using the Exchange/Office combination simply because there isn't anything better.
Also, while many developers are preferring Unix-like OSes, customers actually want Windows. It's what they know and it works well for them.
Another example would be their developer tools ... which are quite well integrated with each other. I have seen many (good) devs that wouldn't dream working without Visual Studio, and if you get a MSDN subscription, the resources offered are top-notch. Myself I wouldn't touch any of that, since I can't stand working with Windows servers, but if they made their tools multi-platform, I would switch without blinking.
> they're not really thinking about what people need
And since when do people really need iPods / iPads or whatever else comes out of Apple?
Actually I think Microsoft does a pretty good job about what people need ... but they aren't particularly good at anticipating what people want.
To clarify, I was only focusing on their approach to emerging markets. How many successful products/services have they created and launched in the last year? The last 5 years? The last 10 years?
Also, sometimes it's a mistake to separate wants and needs! People started carrying their music as soon as the technology let them. That's a trend that hasn't abated in decades. It's not just some passing fad, but a symptom of minds that need to be regularly engaged. To compare Apple with Microsoft, Apple creates the device with the story, and Microsoft just creates the device and the ads
Live Mesh (access my files anywhere), Exchange Online (affordable hosted exchange, my personal email, calendar, and contacts actually in sync, everywhere), Windows Home Server (my music and movies, available on any device in my house, trivial backup, etc).
That's just what I've started using in the past year.
These may not be as awesome individually as an Xbox or an iPhone (which I adore), but they've changed my day to day life.
Mail.app and the iPhone natively support Exchange if you're into that.
iPhone support is great in my experience.
I love Outlook 2010, which I'm beta testing. Mail.app was just too buggy for me and I like being able to have a shortcut key to file email and the rule support is just so much better in Outlook.
