I wonder if the Zune and Kin debacles were a matter of timing. Microsoft saw that they were late to the game, and surmised that the smart phone (and living room console) was the correct path. Based on some of the charts I’ve seen, even iPod numbers have fallen since mid-2008.
It may be inevitable that corporations with diverse product lineups have to abandon specific branches. Clearly, though, the cost of abandonment extends beyond the capital investment. The integrity of the corporation suffers a loss.
If we consider the devices mentioned above, and the abandoned toolsets on the development end (SilverLight, XNA, etc.), Microsoft’s integrity needs intensive care. A monumental commitment has to be applied to this particular branch. A course correction may be tolerable, abandonment could be critical.
Excellent insights, particular regarding the impact of abandoning development toolsets.
Regarding the Kin, it was simply a matter of "project inertia". The Kin was in the development pipeline for such a long time that by the time they decided to kill it, it was too late to pull the plug. For financial, contractual, and legal reasons, they needed to move forward to produce and release it. Even if it meant pulling the plug 30 days later.
My reason for mentioning the Zune (in the context of the Surface), is simply to point out that Microsoft knows how reap a tactical advantage from a misstep. That is something that they do well. (which is a good thing because of all of their missteps) So, I'm not a doom-n-gloomer because they botched the RT launch. Microsoft is really on the verge of turning things around for the long haul. They've been in that position before with other products. But for a variety of reasons, (blind fan following, hubris, etc.) they don't heed the warning of, "don't be stupid"... and ended up snatching defeat from the jaws of victory. That's the historical arc of the Zune. Microsoft is following the same path with the Surface, but now they need to change course in order to not suffer the same fate as the Zune. And there's a possibility that they might actually change course into a better direction.
Apple really hasn't been tested yet on that. It will be interesting to see what happens when Apple produces something so off that even the press in their pocket can't spin it positive.