Isn't this why the stuff out of the Entertainment & Devices division is doing so well? My understanding is that E&D are not as strongly shackled to corporate culture and runs as a semi-autonomous unit making its own decisions, albeit with a healthy cash flow. This is why Xbox has done so well, and Windows Phone 7, for all its critics, is really the epitome of something Microsoft simply couldn't have designed when this article was written. I mean, WP7 actually has a design. You can like it or not like it, but you can't claim it to be a copycat or not show any aesthetic talent at all.

Bing is run the same way, is it not?

It seems that Microsoft might finally be learning that if it acts as a loosely coupled set of components rather than a monolith with everyone getting veto on everyone else, things work a lot better (and presumably cheaper too). They have all the talent, they just kill it with middle-management (see: Kin).