This is pretty much my line of thinking. Being 3rd in anything is difficult. I think it's easy for us humans to conceptualize 2 choices and see their differences; it's much harder when you throw a 3rd into the mix. You like Coke or you like Pepsi. Coke is a tradition, a staple; Pepsi is young and hip. These are cliches, but they affect consumers on a subconscious level. Being an alternative can sometimes still be profitable though, but you have to find your niche. Maybe Microsoft hasn't conceded WP7 to its niche yet.
