On the other hand, Xbox Live Arcade is arguably the service that proved the “app store” model of low-cost, impulse-bought download-only software, and, objectively, the Zune HD and Windows Phone 7 Series are at least competitive in terms of features, design and user experience. It’s not like the only talented people live in Silicon Valley.

Another theory of history would emphasize the sociological aspects: the internally competitive organization of Microsoft versus the Cult of Steve. Once, Microsoft was thought of as among the most meritocratic of tech companies; one doesn’t get that sense anymore. I’ve argued that Microsoft’s tight message control comes across as arrogant and alienating to the most important—and the most influential—group of developers: those who are engaged, enthusiastic and informed.

If you believe in the “Great Man” theory, that the hiring, firing or retirement of one or two exceptional individuals could change everything, then the gap in profits-to-earnings ratios between Apple and Microsoft is irrational. If you believe in the sociological theory, that the ups and downs of product launches and keynotes and this year’s winners and losers are just a distraction from a sea change in the competitive landscape, then a large gap in ratios is rational (if arguable on the competitive merits). I know where I come down. What about you?

Larry O’Brien is a technology consultant, analyst and writer. Read his blog at www.knowing.net.