By most accounts Microsoft is struggling. Last week the company posted its first quarterly loss in its history; Nokia is selling hundreds of thousands of Windows Phone devices (not millions); the market share for Windows Mobile, a ten year old OS, is still larger than Windows Phone; and huge questions abound about whether the hybrid Windows 8, be all things to all people, is the right strategic choice.
Microsoft is in a tough place and I believe it is due to one core factor. When you are a product leader your job is to always play feature catch up. In the DOS/Windows days all Microsoft had to do was integrate the latest and greatest features other OS and apps did. It would ensure they stayed in the lead.
But when you are following you have to do something distinctively different to be recognized. Playing feature catch up doesn’t work and you can’t freeze the market by pre-announcing products. That’s the position Microsoft finds itself in now, a role it has never been in before.
It strikes me, though, that the company is still playing by the old rules.