nickel, look at it this way: MSFT didn't necessarily out-innovate Netscape, either: they just took away its oxygen, as I think the famous quote had it.
Look at what they've done with the X-box. And don't tell me they're losing money on every box sold: tell Sony and Nintendo, etc.
Anyone who dismisses MS's entry into the portable music player market on the grounds that they're "totally uncreative" may be in for a rude awakening.
They don't have to out-create the iPod; they only have to come up with something good enough for their installed base.
The innovation's already been done; MS just has to come close and then leverage their huge -- you can call it captive if it makes you feel better -- user base.
Those who have tried to unseat the iPod simply haven't had the resources to throw at it that MS does.
I wouldn't necessarily be shivering in my boots, but I would be wary, very wary.
Now we can only hope that MS somehow tries to shoehorn Zune into Vista, thereby further delaying the delivery of the latter until next summer. Or fall.
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