Microsoft is the king of blowing a massive, industry-defining market lead in the fourth quarter due to unforced errors. Especially in the 21st century:

• They were the default office suite, to the point where their trademark became the category name, and they even had SharePoint; but their stubborn refusal to get into the cloud document game handed off the top spot to Google Docs.

• They were the king of K12 education by default, since Apple was so expensive and essentially the only factor that matters in K12 is price. Then they completely ignored Google offering really good deals on Chromebooks for a decade or more, and now Chrome OS is the dominant K12 platform.

• They owned Skype, which was genericized as the popular verb meaning “to make a video call.” But they ignored the opportunity that was the pandemic, and Zoom not only ate their lunch but took the genericized trademark crown.

• They had Lync, which was the de facto messaging app that every Enterprise deployment used. But then they didn’t update the app for a decade except to change the name to Skype for Business and then to Teams, while Slack ate their lunch.

• And, as you mentioned, they had the top browser for both users and developers, but did nothing with it until Chrome got unattainably faster, easier to use, and more standards-compliant.

• Xbox was never the singular market leader like these other things—they’ve always played ping-pong with PlayStation—but Microsoft owns Rare, an industry defining studio, and they’ve completely wasted them for years.

• They never had dominance in the smartphone world, but they were poised for it with a well-liked and visually distinct platform in Windows Phone which they just abandoned.

• To a certain extent, they had a sort of “goodwill dominance” in their operating system, which they frittered away on automatic updates and design overhauls and (more recently) AI that nobody was asking for.

They lost all these massive leads while they were chasing dominance in search, or video game livestreaming, or AI, or whatever. They always seem to be focusing on the thing that doesn’t matter while their dominance just flutters away in the wind.