Windows Phone was a wakeup call, but they are still trying to figure out what to do about it. It's sort of like the villain in a movie who thinks he's invincible then sees his blood for the first time. That 'oh crap' moment. Before then, it was just a matter of lack of trying.

You're right about the personal devices, and it's a big deal. Microsoft's strong point has been a full stack, but the issue is that the ecosystem is evolving faster than Microsoft is. I don't think it's as much of a safe bet anymore- Microsoft's inability to execute is causing a lot of concern for partners.