What to do?
Thing is as a company that primarily makes and OS and an office app, there's limited room for innovation anymore.
In the beginning, the desktop OS was functionally limited by artificial hardware legacy. Now with x64 that's gone.
In the beginning, the desktop OS was hard to configure and hardware didn't work well with it. Now with plug & play and Internet access for automatic driver pulls, that's gone.
In the beginning, the desktop OS was an island, designed for unconnected environments. Now with the NT kernel it's got networking, domains, security and such by default, so that's gone.
Bottom line is that WinXP frankly did ENOUGH to make anything after it a difficult sell. There's nothing killer in Vista/7/8 that folks must have. There's no feature that evolves the whole concept of a desktop OS to a new level of baseline. It's just... incremental updates basically.
But when the art of the OS is essentially "almost everything you could ask for", what is the maker to do? THAT's the struggle.
Maybe where there's still room is reliability.
Imagine an OS that's malware-proof because it recognizes obnoxious behaviour and self-heals. Every boot it says "hey, did some jackass window you don't want pop up, blocking everything else and breaking your browser? 'Cuz I think one did. And I can just roll back that stupid thing." How about an OS that properly tracks the origin of changes to its config and lets you fix things at a granular level? System started hanging occasionally? Hey, turns out that installing XYZ application changed some random DLL that's also in use by the print driver and that's why... here, let's fix it.
Just a thought. But beyond that, I don't know what the hell else MS could introduce that folks actually WANT.