As an example, the Office team's goals aren't to prop up Windows as a platform by providing a sufficient but substandard product on other platforms, but rather to make a great product; as a result, Office 365 for iPad. The Surface team isn't about making a platform to foist Windows 8 onto people or pressure tablet makers, it's about making a great personal tablet/laptop frankenstein.
Likewise, Azure is (reportedly) a great backend for apps on all kinds of platforms, especially on iOS, rather than a 'competitive advantage' to make sure that Windows 8 and Windows Phone 8 work great with each other and only with each other.
I really feel as though this is the right direction for them, and that it's producing some really great results so far.
Sometimes products developed inside a company such as Microsoft have to accept constraints that go against competitiveness, or might displease users, in order to further the cause of another product. I recognized the concept but had never heard the term.
An example. Consider a company that develops both a Web browser and a word processor. The product team for the browser might get lots of input from users saying "We'd like a better editor in the browser." It would be natural to give the users what they want. So they put the feature in their project plan, but when it comes up for review, the CEO shoots them down. "They should use the word processor," he says.
Which is surprising as he was using it as part of his major workflow for a while over his cintiq.
That's a good thing for everyone else. It means better products and stiffer competition, but only if Microsoft recognises the true scale of the challenge facing them. There is so little good will towards Microsoft who are still seen by many as the lumbering, malevolent spoilt child of tech that (as I've already said) being good or a bit better falls far short of the leaps and bounds they need to be making.
I for one have been enjoying Microsoft's slow motion fall from grace and I'll continue to do so because I'm still angry at they way they've behaved on the web and abused their position with Internet Explorer. People may well disagree with my view point, but disagreeing with me (and the score like me) makes no difference. It's the way we feel, the way we will continue to feel and Microsoft will need nothing short of a miracle to change our minds.