Probably had more to do with the DoJ antitrust suit than the dot com crash. Microsoft approached anything that sniffed of antitrust violations with trepidation for a good 5-7 years.

But yes, ultimately a good thing.

Yes, this is often forgotten. I've always assumed it's the biggest reason for Microsoft basically doing less & being more or a cash cow during the Ballmer years (similar to Apple's current philosophy with a CFO as CEO).

Though the phone fail was a huge fail. Those initial Windows phones were really awesome. These were the ones that competed with Blackberry before Apple took over the market.

Microsoft phones only died because they were bad at making an App store. Microsoft made the exact same mistake with the later Zune HD. Despite having a massively superior IMO experience for the user, Windows phone was doomed.

The lock-in is mostly because competitors were not good enough to implement a similar solution, not because of artificial restrictions.

As an example of that lock-in... It's 2023, and my Fortune 250 corporate laptop image still has IE (along with Edge, Firefox, AND Chrome), because we STILL have web applications that were tied to ActiveX, and still need it.