The article completely drops the ball on the Xbox. The XBox is Microsoft at it's best and it shows. I understand trying to prove a point, but lets not be disingenuous.
It feels like Microsoft is 1 winning product away from turning the tide, or 1 loosing product from sealing it's irrelevance. I can't help but think how this article would've been written if Windows Phone 7 turns out to be a huge success 2 years from now. It's easy to paint a gloomy picture.
The only trouble I see for Microsoft, is one where they are not seen as a leader. One where reactionary product after reactionary product renders them as a technology company seen by the outside world as chasing technology and not laying it's bricks.