In answer to your question at the outset I say; no, Microsoft is not drifting into insignifigance! It think it is funny how we are all like a bunch of lemmings. It is popular and chic to bash Microsoft these days and everybody loves to jump on the band wagon. Personally I try to have no allegence to one company or another. I mean, really, who cares. Macs are cool, Google is cool, Android is cool...but I hardly think any of these are revolutionary. Take Mac. What is it? They are computers that are very stable and have a slick interface. Right now they are the latest fashion accessory. People buy them, I am convinced, to look cool because Macintosh has marketed them as a 'cool persons' computer. Are they? No...they are just a good computer. At what cost do we get this stability? We have limited abiltiy to upgrade components and soft backward compatibility. Macs stability comes at a cost. Since it inception what have the Mac OS's done? They have built on their same product. Just like Windows. It is not like Mac is coming out with a totally new OS each version. It is just building on the last. Somehow this is seen as more innovative that Windows? I don't get it. They are all doing the same thing...many of htem built on MS ideas to start with.
The iPhone was an innovation but it was not something that had never been concieved before. We had PDA's long before iPhone. To me, it is just another way to package the same idea...albiet in a very cool and usable way.
I could go on and on. Bootm line is I hope all of these companies continue to innovate and push the limits of what is possible. I just wish we as a technology community stopped all the sensational grand standing to support the superiority of 'our favorite' companies and just gave credit where crdit is due.
Microsoft is big, it has been around for a while, but many of the ideas coming out of Redmond are still cool, just like Google, Android, and Mac.