The Microsoft business model is "old and busted"
It was never a very sophisticated model anyway. Establish a monopoly position and then use it to force customers to swallow whatever you shoved down their throats. But, aha! (and ha ha ha!) Vista is in the anomalous position of competing with its predecessor XP, and guess what? Customers much prefer XP to Vista. Moreover over there in the bushes, Linux and Mac OS are making rather attractive cooing noises and luring the adventurous in that direction. (For some values of "attractive". Does the Mac OS wear leopard-skin bikini underwear? Does Linux favor black leather bustiers?)
As far as I can tell, Microsoft is so used to ignoring what the customers want and *truly* need that finally they've produced a system so contrary to those wants and needs that the market is rejecting it.
Three things strike me about Vista: first, it's another example of pointless change in details. The way you do something in one version of Windows has often been different from the previous version, even though the previous version worked just fine. Vista merely carries on this tradition, but in spades. The administrators are justifiably annoyed.
Second, in spite of the amazing increase in processing power, PC's have slowed down; the increase in hardware speed has been stolen and handed over to the functions the users neither want nor need, for example end-to-end encryption of HD signals. See
for some of the gory details.
Third, Vista, much more frequently than previous versions of Windows starting with Win95, gives rise to the cry "hey, whose computer is this anyway? Mine or Microsoft's?" When the OS starts to actively interfere with the use of your machine, as Vista evidently does, it demonstrates some kind of fundamental ethical blindspot on the part of the OS developer.
In a way, Vista is an interesting example of evolution in action. If you (hypothetically) build The Perfect OS, then any change whatsoever is a step down. I suspect that XP is reasonably close to The Perfect OS, at least as far as PC users are concerned, so Vista can only be a backward step.
The situation has its amusing elements. As others have pointed out, Microsoft's response to the Vista fuckup is spin, spin, and more spin, but we've got so used to lies, distortions, smokescreens, fairy tales, and myths that spin doesn't do much anymore except transfer dollars from Microsoft's pockets into the pockets of the spinmeisters.