alrs is true ; in most cases your work is automatically replicated to Ubuntu (where the package-maintainer relationship is less strong than in Debian. Most packages don't have a dedicated maintainer there).

And everyone can do it ; no sign-up or complicated process required. You just have to find a sponsor for your packages which is just a fancy name for "every code needs review". Debian is often described as bureaucratic but most of the processes are very sane.

Canonical need to be more profitable, indeed they're probably not or barely profitable yet. They seem to have two ways of increasing profit a) monetising their existing desktop user base and b) Getting more desktop users so that more businesses become comfortable with it and buy business support.

Then what is the problem exactly? Every time Ubuntu comes up, people ask if it is fully hardware compatible. Is that just a branding issue, where people think Ubuntu isn't hardware compatible with most modern laptops?

There are multiple problems, the main one is that windows is known, comes "free" and already installed when you buy a computer, is less of a risk and is good enough. Most people will know a "computer guy" who can help them with windows or be comfortable that they can pay someone otherwise.

Software is a bigger problem in some ways than hardware now (though the web is fixing this), note the effort Ubuntu are putting into the software centre, allowing paid for apps, proposing to relax the restrictions to get new software into Ubuntu, running app competitions and so forth.

Selling operating systems isn't easy, look at how long apple have toiled in the wilderness and they have linked hardware, loads of good will via ipod/iphone, billions in the bank and have managed to climb to something like 5%-10% market share.

In contrast, Mozilla gets most of its income in an almost identical way (making google a default search provider) and that's not considered desperate.