I wrote this in March of 2003, although I think it still holds true.
These are certainly not real rules, but are rules that Microsoft appears to follow by their actions.
Microsoft Rule #1: Every app must be expanded until it can be used as a vehicle for a virus that can trash the system. (In fact, no app is useful unless it can be used as a virus vehicle. If MS wrote edlin today it would be possible to hijack it through TCP/IP and use scripting to access kernel functions.)
Microsoft Rule #2: Flexibility in UI is acceptable, but defaults must confuse new users and frustrate experienced ones.
Microsoft Rule #3: GUI standards are no longer necessary. Shiny objects are always user-friendly.
Microsoft Rule #4: No useful thing can be designed unless by committee. Consistency and clarity are not signs of maturity. Simplicity is for amateurs. (Breaking up Microsoft would have about as much effect as asking a blind guy if he would not look over people's shoulders during the final exam.)
Microsoft Rule #5: Security has less "gee-whiz" factor than skinning and is therefore a less important feature. (Plus it's just too darn much trouble to check each memory buffer copy, especially when we'd rather spend time making the media player look like eyeballs. 2006 update: Although security is better, I still think I've heard more hype about Aero than Vista's security improvements.)
Microsoft Rule #6: Dominating a market is the same as excelling in a market ("Economic might makes right", or more simply "A monopoly means God smiles on everything you do.").
Microsoft Rule #7: Change is improvement, by definition. (But this is universal among software companies...)
No doubt Microsoft does some good stuff, but they stopped being a software company in the mid 90's. They are now a marketing company that exists solely to maintain their market share. Semantic difference, you say? Perhaps, but a software company exists to write and deliver better software than the competition. Microsoft, as a marketing company, exists to make sure people keep using Microsoft, regardless of what the competition is doing, and regardless of whether their software delivers more value than the competition's, or even their own earlier versions... because we all know the biggest competition to Vista is, in face, XP and Windows 2000.
The irony of the Federal antitrust suit in the late 90's was that the real damage was done in the late 80's and early 90's. Just ask Andrew Schulman. Microsoft had significant functionality in Windows that was undocumented, and therefore Microsoft alone, or whomever Microsoft chose to bless by granting them the boon of the secret incantations, had a significant advantage when it came to writing high-performance software, or software that required low-level access to the operating system. That Microsoft was actually declared by a Federal Court to be a honest-to-John D. Rockefeller monopoly, the Bush administration came along and let them off the hook with a stern finger-wagging. "Look, just don't do it any more", John Ashcroft is alleged to have muttered, still smarting over the fact that he lost his Senate re-election bid to a dead guy.
By the time Netscape started their toddler tantrum over Microsoft bundling Internet Explorer with Windows, it was more than five years too late to make a difference. Netscape was just whining because their grotesquely bloated version 4 was inferior to Internet Explorer version 4 (whereas prior to that the Netscape browser was much better). I wonder why Adobe didn't have a problem with the fact that Paint is also shipped with Windows. Given Netscape's logic, the Zippo Manufactuing Company should be suing General Motors for putting a cigarette lighter in the Hummer 2.
Internet Explorer is as ingrained into Windows as ever, and that hasn't stopped Firefox from making significant inroads into Microsoft's share of the browser market because Firefox is simply better overall and more secure. More specifically, Firefox probably has the majority of market share for those people who are knowledgeable enough to understand the difference and know how to switch browsers. I haven't played with Internet Explorer 7 yet, but everything I've read indicates that it, at best, catches up with the more modern browsers, and doesn't offer anything significant over software like Firefox and Opera.
Microsoft is at a crossroads. They will either need to make their new offerings relevant and compelling, or will start what will become a long, painful decline. Sadly, Vista seems to offer too little too late. Given that the only thing driving end users to upgrade from Windows 2000, aside from wireless support and a few other small improvements, is that Microsoft will soon discontinue support for Windows 2000, Vista does not offer any compelling "gotta have it" features that make the multi-hundred dollar upgrade worth bothering with for the vast majority of users. I suspect Microsoft will have to rely on Vista being shipped with new machines for the majority of its sales, although that will be a significant amount.