With Microsoft's vast reach in the marketplace, it seems the company regularly has an area where it is trying to be better than the competition or has a challenger to one of its many products. This is nothing new, its been going on almost since the beginning of recorded history - at least since Lotus gained ground over VisiCalc, only to see Microsoft Excel later gain market share over the 1-2-3 spreadsheet product. Later it was WordPerfect, Novell ... I suspect you can think of others. Sometimes Microsoft has been more successful than it is other times - Internet Explorer may have gained a commanding market share over Netscape Navigator, but that market share has declined against Firefox, Google Chrome, and others. And Microsoft's Bing is nowhere close to Google's search in winning hearts and minds.
Let's look at hypervisors. VMware has long been accepted as a market leader in this, and Microsoft has been adding features to Hyper-V to try to gain hearts and minds for the cloud-computing platform. A Network World article by Julie Bort in 2011 (http://www.networkworld.com/news/2011/102711-microsoft-hyperv-252460.html) discussed Microsoft claims that Hyper-V in Windows Server 2012 would leapfrog VMware's vSphere by promising management and storage features that VMware couldn't touch. VMware of course disagreed.
Today, Windows Server 2012 is released software. VMware has had changes in executive leadership and a recently lowered stock price. Its momentum may be slowing down (of course, the larger the market share one has, the more difficult it is to sustain 20% or higher growth). This doesn't mean Microsoft is necessarily overtaking VMware any time soon, nor has it leapfrogged VMware in functionality. However, some smaller and medium-sized may begin to feel that Hyper-V is "good enough" for many workloads (http://www.networkworld.com/community/blog/vmwares-problems-are-deeper-just-microsoft) as they may not need all the bells and whistles of vSphere. Whether this will have a long-term impact remains to be seen.
Look at another market area: the smart phone. Microsoft seems to have gone five steps backwards for every step it tries to take forward. (Disclaimer: I use a Windows phone.) From Windows Mobile to Windows Phone, Microsoft's market share has continually declined against that of Android and the iPhone. While Windows Phone 8 is now (finally) based on mainstream Windows, that doesn't mean Windows lovers are falling over themselves to adopt this new smart phone platform. It seems like Windows Phone squandered its user experience advantages over the past few years. As a Windows Phone user, I am continually frustrated by merchants only offering apps for Android and the iPhone. Why not? Those are the two market leaders. Mary Joe Foley recently said Microsoft is moving toward making its Windows Phone apps available on Windows, and its Windows 8 and RT apps on the Windows Phone (http://www.zdnet.com/microsoft-working-to-unify-further-its-windows-and-windows-phone-platforms-7000011070/). We'll see if that makes any difference. Microsoft is way behind in the tablet and smart phone markets; will they come out from behind or become irrelevant?
What about Microsoft and management? System Center 2012 SP1 is released, and creeping closer to Windows Server and cloud-based management. The Intune connector to Configuration Manager 2012 SP1 promises new management capabilities between Microsoft management software and smart phones (not only Windows Phones). Where will Microsoft end up in this market? Only time will tell.