Microsoft is reaching the same place that IBM got to back in the 80's - the inertial point where their partners are starting to look for the exits:

The ecosystem that Microsoft (MSFT) has built up around its Windows operating system is showing signs of strain. In one of several recent moves by partners that sell or support the company's software, Hewlett-Packard (HPQ), the world's No. 1 PC maker, has quietly assembled a group of engineers to develop software that will let customers bypass certain features of Vista, the latest version of Windows. Employees on a separate skunk works team are even angling to replace Windows with an HP-assembled operating system, say three sources close to the company.

Microsoft's response to this kind of thing seems to be an utterly stupid advertising campaign. I fully expect Microsoft to get a lot smaller before they find their mojo - pretty much just like IBM back in the 80's.