Microsoft's problem is a lack of focus and many different groups, with different responsibilities, internally fighting over the direction of some products. This is the reason why so many products take an age to come to completion and then either get cancelled or get really conflicting marketing.
The KIN is a perfect example of this, it was the original attempt by Microsoft to increase their presence in the mobile market, but internal disagreement over the software it would ultimately use meant it had been delayed two years. Even before it was announced their were rumors of it’s demise. Windows Phone 7 Series was announced before the KIN as well. They knew it was dead on arrival.
Here is a good analysis of what went wrong:
http://arstechnica.com/microsoft/new...gic-demise.ars
Microsoft can get it right when it is focused. Take the XBox. That was run very well, with a clear direction, no infighting, no ‘let’s base it on Windows and run Office’, just a well executed device and they beat Sony with their second attempt.