Microsoft sees Facebook's success, thinks "I'd hit that", and decides to make yet another island where products can languish under the hot hot sun. And coconut trees.
I've gotta say, I think Steam has them beat here, except it doesn't have a Microsoft logo on it, so of course they can't support it.
Anyone remember "The Zone"? I grew up playing chess and checkers online through Microsoft's platform. It was silly, but I was able to play with other kids in Canada, the UK, and all over the world. That was amazing, back then, that is.
I agree Microsoft had an opportunity to capitalize on casual game and they missed it. In fact once I think about it Microsoft was really close to it. They had MSN Spaces, essentially a dumbed down version of my space and they had The Zone. MSN Spaces already had MSN messenger intergration and MSN messenger provided games you could play with your friends, my favorite being Hexic. Looking back it seems like such a natural move to try to tie it all together. Of course Hindsight is always 20/20.