The management got too rosy picture of what Windows Phone 7 was (a quick hackish MVP, nothing more, like the first iPhone few years earlier) and they were really surprised when upgrade path to Windows Phone 8 was really hard.
I recognize that the transition was necessary, but between the lackluster functionality (notification center, for example, was the #1 requested feature for years), lack of updates (8.0 to 8.1 took 20 months), and, of course, lack of developer support, I'm wondering if Windows Phone had a chance at all.
I will never stop being upset over the death of Zune HD and WP7 era Metro UI, though.