  "In 2002, Microsoft posted gains in court, revenue, product lineup. As Sun Microsystems, AOL Time Warner and Oracle struggle with low stock prices, revenue declines and layoffs, the company they all love to hate had a phenomenal year. " MS biggest competition is themselves, Linux, and all the new type of electronic devices. I believe the PC will always be the "hub" of all those devices, mainly because the "form factor" of dealing with your content or personal data will always be optimal on a larger screen, not smaller. 
