Microsoft should prepare itself for a world in which the consumer computing experience will no longer be dominated by a single player. Apple, Google, Palm/HP, Blackberry, Nintendo, Sony and probably many others will grab a share of the time and money that in the past would've gone to newer Wintel PCs.
Ms should target Windows as a strong business-only brand, and this focus would probably make for a better product. It's probably wise to still play in the consumer market, with XBox and Windows Mobile and whatnot, but expecting lower margins and increased competition.
Also, please hire someone to come up with better names for your products. It's getting ridiculous.