The Distrowatch page hit rankings are very misleading. When I was using PCLinuxOS 2007 (and the two releases before it), it was ranked #1 on the PHRs for almost a year. But, Ubuntu had significantly more downloads during that period and I consistantly encountered more Linux users using Ubuntu than any other distro. On their forum individuals would occasionally post messages encouraging users to goto Distrowatch and click on PCLOS. Dittos for the Mandriva forum, which I used after PCLOS. I prefer the KDE desktop and I switched to Ubuntu's orphan brother, Kubuntu, in Feb of 2009.
Since its release Ubuntu has been the most downloaded, most installed and most used version of Linux. And, it remains so today, despite the feelings of some Gnome users who dislike Unity. The reasons are simple.
First, Shuttlesworth has invested about $10M/year of his own money into Ubuntu's development, marketing and support. It's been pre-installed by OEM more than any other Linxu distro. I don't know of any other distro maker who is investing that kind of money in their product.
Second, until recently, Shuttleworth paid for the cost of mailing an install CD to anyone who asked for it, and he's supports the Ubuntu forum, which has a message volume several times larger than any other forum, regardless of the distro it supports. Compared to Ubuntu, all other distros are literally on welfare, in terms of their financial support, except for Fedora and SUSE, and who knows how long SUSE will last. Mandriva can't sell enough commercial boxed sets or ISOs to keep their doors open.
Third, with Natty and beyond, Canonical has Ubuntu offering more than just a distro, they have added content and services as well. While I don't run a Unity desktop I am using Ubuntu One's equivalent of DropBox, which I also use. Canonical has done more marketing and published more ads than any other distro maker. And, Canonical has and is doing advertising in Linux magazines as well as on several very popular Linux blogs. BUT, Canonical is now advertising for a "Product Marketing Manager, "to lead the marketing charge of establishing Ubuntu as a core piece of technology in businesses and supporting the efforts to provide for-pay services to those users." IF Shuttlesworth wants Ubuntu to be more than self-supporting and actually make a profit that is something they have to do.
Fourth, these are difficult economic times. The market is trending toward tablets and smartphones, at the expense of desktops and laptops, although neither of those two will disappear any time soon. But, supporting the development and maintenance of distros for each of those platform is costly, time consuming and over lapping. The current solution appears to be to create a desktop GUI which automatically detects the hardware it is being installed on (nothing new there) and then configure a common desktop interface so that regardless of what is before the user: desktop, laptop, notebook, netbook, tablet or smartphone, the user experience will be the same. This approach will end up releasing an ISO which is small enough to install on a smartphone, but with the aid of a network connection will download additional utilities and applications to fit the larger devices.
While problems often get a lot of press time because the press likes controversy, the Gnome vs Unity blow out will resolve itself the same way the KDE 3.x vs KDE 4.x did, and for the same reasons: software technology advances with the hardware. Now, you hear little from those who whined a lot about KDE 4, because KDE 4.7.x has made believers out of the majority of them. I am now running KDE 4.7.3, and it is far more powerful and easier to use than any previous desktop I've ever run, since I bought an Apple ][+ in the summer of 1978. When I am called upon by some XP, VISTA or Win7 users to help them out of their computer problems I immediately feel shackled in what I am allowed to do, and how it has to be done, in those environments. Those who took my advice and switched to Kubuntu, which are the majority, never return to Windows, and the number of times they have to contact me for help drop to near zero.