I think Microsoft should really just say "screw it" and fight hard to bring it back. Having ZERO CONTROL over a mobile endpoint is hurting every corner of their business, whether it's AI, search, Office, Microsoft Teams, gaming, etc. etc.
But even if they did, would they stay in the fight?
That's always been the issue with getting behind Microsoft. They have a nasty habit of walking away.
With Panos gone, and sales sliding, I wouldn't be shocked to see the surface brand under threat of the axe.
There was an article the other week on the Google/DoJ case, and it turns out Google pay Apple over $10 billion a year to remain the default search engine on iPhone.
Its a lot of money, but Google probably think it's a bargain.
The point is that tech companies are not above paying other tech companies to bring their apps/services to their platform.
Thinking back to Windows Phone, the single biggest point of failure was not having Snapchat and instagram at a time when that's all people wanted on their phone. They simply couldn't attract an entire generation of narcissistic teenagers to Windows because those two apps weren't in the store.
Looking back, they should have paid whatever it took to get those apps on the platform. Had they taken that gamble, there's a good chance that far more people would have picked up a Lumia.