Microsoft's lack innovation is a result of a couple of factors I can think of: -Leaders without vision: Gates wasn't perfect, but he at least put forward the v

Microsoft's lack innovation is a result of a couple of factors I can think of: -Leaders without vision: Gates wasn't perfect, but he at least put forward the vision of a PC in every house. Ballmer is more of a cheerleader than a visionary, and "three screens and a cloud" isn't a vision of the future so much as commentary on the present. -Hubris: Making billions of dollars is an easy way to justify that you are "doing the right thing", even 15 years later. -Customers focused: This is a little more subtle, but I think a culture making products (Windows, Office) for "Customers" is different than a culture making products (Gmail, Search) for "Users". For the former, you could pessimistically say that your main objective is to make a product you can convince someone to buy. Whether or not the customer uses the product is somewhat incidental. Each subsequent version must have enough features crammed into it to justify the customer paying again, even if they aren't useful. In contrast, focusing on the user provides more motivation to keep the product relevant, make the product useful, and so on. If it isn't, the users can simply stop using it. -Middle-child syndrome: If your team isn't making $1+billion, no one cares. It is hard to have the proper resources to innovate and be creative if most of your management chain doesn't know your project exists.