Joe Wilcox of Betanews writes an excellent article on why Microsoft is stumbling, and how they lost their initiative after the major gains in the late 90’s and early aughts…
Microsoft executives and product managers — Chairman Bill Gates, above all of them — showed great technology vision for the new millennium. The company was right about so many trends to come but, sadly, executed poorly in bringing too many of them to market. Microsoft’s stiffness, perhaps a sign of its aging leadership, consistently proved its foible. Then there is arcane organizational structure, which has swelled with needless middle managers, and the system of group competition — and in the new century compensation — that worked well for a growth company but not one trying to manage mature markets.