Check this out:
http://abhishek-myspace.blogspot.com/2007/07/microsoft-ceo-steve-ballmers-office.html

Right now, their collective nemesis is free software of another kind (both Open Source as a whole and Linux,) which are forcing Microsoft to contemplate competing in a way they’ve never had to before — on quality and not price.

They’re also entering into a battle with Adobe that I don’t see having a happy ending for them.

The current problem for Microsoft is their aging business model. To a large degree, it’s just not applicable anymore.

Plus, if it wasn’t for Windows and Office, then there wouldn’t be a Microsoft, since those two product lines effectively subsidize everything else they do, including their Xbox platform. Which incidentally, is yet to turn of a profit, despite its relative success.

And when you consider that almost everyone at Redmond are hanging their hats on the Xbox, it’s more like salvation they’re looking for more than a strategy.

Problems deepen, though. If we consider the lamentable Zune as being, well .. lamentable, and that Microsoft may be looking to produce an Xbox portable, they become their own competition more than any true competitor to either Apple or Sony.

In the eyes of the consumer, it’s not clear which gadget to buy, or for why.

And this is what Microsoft just don’t get. They’re constantly trying to apply their corporate knowledge to everything else.

Sometimes, lots of choice is no choice at all…