This is the nub of the problem. Drilling down through the bullshit, Windows 8 seems to be the archetype of what Ballmer has in mind... and it sucks. Apple have been criticised for making OSX too like iOS but in reality most of the changes can be ignored, the only thing that really confuses people is reversing the mouse wheel scroll (which can be reverted easily). The whole 'magic corners' thing on Win 8 is stoopid, particularly when Win 7 is such a great OS (and I say that as a card- and iPhone-carrying Apple Fanboi).
Microsoft's main competitor is themselves, and their best strategy right now would be pushing and incentivising the replacement of XP with Win 7 in the corporate environment to drive sales of updated Office and server software.