Just as Microsoft were slow in recognising the value of the internet and connected computing, I believe they have missed the boat on cloud computing - even though with Skydrive they were one of the early players. Windows 8 is supposed to be the OS that fixes that but its going to be so challenging for users that I'm struggling to see that really happening.
Don't get me wrong, Windows 8 looks fabulous and, especially if you're a previous Windows Phone user who 'gets' the new interface, it works well where it works. For others its going to be a complete nightmare.
The problem is that good as Windows 8 looks, it doesn't work anywhere as well as Windows 7 unless you're talking about a touch device use scenario. Plenty of new devices will come touch enabled, but realistically unless you're talking about a tablet a touch screen isn't the right way to interace with a laptop/desktop computer.
Office 365 flags the direction that Microsoft should be taking - and as the traditional PC market shrinks, as it will do over the next five to ten years - this would be Microsoft's hedge bet against the erosion of core revenue streams for Windows and Office. Microsoft needs to ensure that Office 365 works well with touch only devices and make it work with iOS and Android devices. I believe that the next version of Exchange will switch to an HTML 5 browser based client only (killing off Outlook) and Microsoft needs to recognise that this is the path for Office too.
If it doesn't make these difficult decisions now Microsoft may not have much of a future ahead of it. The writing is on the wall, read it wrong this time and Microsoft may not get a third chance.