Microsoft has for very long invested billions of dollars into their technology R&D departments.
I mean, they had the Tablet PC with wonderful handwriting recognition, Windows Mobile (PocketPC) with on-screen transcriber running on a low low 128MB ram with sub-200 Mhz processors. Visual Basic (and Visual Studio by extension) allowed really newbie programmers to just get in and start coding. They acquired and promoted WebTV long before AppleTV or GoogleTV were even being thought of. I mean, look at the WebTV hardware specs. And this is just a short list I came up with in a few minutes.
So, with all of the above, what went wrong? Sure Visual Studio is a success, but that is also the only non-consumer product in the list above. In fact, it is such a success that even Google knows that Android development can only be pushed ahead with such Visual tools, hence the Android AppInventor.
Microsoft has always tried to talk about their R&D spending ($9 billion, in the last year, recession, et al). Why then do their actual consumer products not have spectacular successes?
I think what Microsoft needs to do is start shifting a lot of their Tech R&D budgets towards Market Research. If they had done market research, they would know that the Kin phones/devices are not working out. If they had done market research with college going kids, they would know that Tablet PC are ok, but OneNote is the real killer app. If they had done market research, they would know that the Courier device, even with half the marketing budget hype of the UMPC (whats that, you ask? heh) could be a real competition to the iPad.
Microsoft is still trying to compete with Google and Apple using the tools they used to originally compete with IBM. Doesnít work.
And when Microsoft does get itís market research right, even a Bing can happen!