I wouldn't say dying just yet. To me it just seems like they are not such a popular brand when it comes to Smartphones, MP3 players, etc.
In my opinion, they should focus on what they do best - their Windows OS, server packages and office package and people do tend to prefer manufacturers that specialise in what they are looking to buy.
For example, the average person getting a PC would be reluctant to get a computer without Windows, unless they are a Mac or Linux fan. However, that same person may go for an iPod over a Zune, as they know Apple specialises in portable audio products. In turn, that same person may go for a Linux based network media player over a Windows based HTPC or Apple TV, as most network media players run an embedded Linux OS, often without the end user even realising what powers their system.
Until someone comes out with an OS that proves to be a serious competitor to Windows, I don't think Microsoft will be dying off that soon. :disagree: