microsoft should understand that mobile is a battle they can never win, they should count their blessings and focus entirely on the enterprise side of their business.
Not that this is unassailable reason, but I've heard people say the exact same thing about Microsoft in 1999. "Palm's so far ahead of them, etc. etc." - a few years later, Palm was shipping Windows.
Microsoft's fundamentals on Windows 8 mobile are quite solid. Even the design aspect ("pure digital") is something that both Android and iOS are moving to in some form.
It's true that WP7/Win8 haven't launched as well as they'd hoped, but calling it over seems rather premature.
It's true what you say, but we have a different world nowadays. In 1999 Microsoft was the undisputable world champion in IT, they were the only ones who had deep pockets, lots of users and a tremendous software ecosystem. Now we have both Google and Apple with deep pockets, lots of users and software in their stores.
Google is even playing the Microsoft card, developing a desirable OS for the hardware manufacturers to use in their devices. And the hardware manufacturers are delighted because not only it's free, but they also can have their own app stores and add value to differentiate themselves from the competition (look at Samsung with the Galaxy devices). It must be a hard sell to convince these guys to return to Microsoft, be just another "Windows devices + crapware" manufacturer and stay away from the profits of purchased apps.
On the other hand, the much touted inertia towards Microsoft products has been debunked, I think. Many people seem quite happy and productive with iWork or QuickOffice on their devices. And that cannot be overstated, once you see that in the end you could do work without Microsoft Office, it's really hard to put the genie back in the bottle. The other part was games, and you can find plenty of them both in iOS or Android.
So, not impossible, but it's clear that this time it will be very difficult for Microsoft to be topdog in mobile. They are late and struggling.
To a large extent Microsoft's success is based on have similar technology (or at least similar looking technology) at both the consumer and enterprise level.
Kids growing up using Windows to play games and browse the internet will find it a very smooth transition to using a Windows PC at work or learning to configure a Windows Server.
Sometimes you don't need to win to make a profit, however. MS does have a huge enterprise business. Now what happens when an enterprise that uses MS computers everywhere, MS servers, MS exchange, etc. wants to add tablets? They are far more likely to chose an MS tablet because they are already running all the MS kit anyway and have all their software and support staff targeted at that. MS even puts forth the non-RT version so the tablet can replace the PC if needed. There are companies with millions of dollars sunk into desktop PC software.
So even if MS never wins in the consumer market and always just runs second third or fourth, having their own in house solution could still be cost effective.
The thing is Win RT it's not anything like previous versions of Windows, both from a user interface standpoint and from API/ABI compatibility standpoint. it does not support Active Directory, fullnExchange or most other Microsoft enterprise integration tech. There is no compelling reason for a corporation to go with surface.
Bizarrely iOS and Android both have better Microsoft stack integration.
Microsoft's fundamentals on Windows 8 mobile are quite solid. Even the design aspect ("pure digital") is something that both Android and iOS are moving to in some form.
It's true that WP7/Win8 haven't launched as well as they'd hoped, but calling it over seems rather premature.