Build on existing/unique strengths:
- Best camera (like 1020)
- Build further on tile design (better than IOS and android)
- Enhance Cortana (to be more like Alexa but with more focus on business: Meetings, schedules, planning, contacts...)
- Stellar sound (I would buy Spotify if I were Microsoft, they are still ahead of Apple by far)
New innovations:
- Hologram projection (games, movies)
- 3D
- Bluetooth headset with microphone that look nice (not like the Iphone airbuds)
- Scanning technology of faces, places, buildings, food (calories etc.)....
- Connected with a "health band" on your wrist to track exercise, health etc.
- New superfast typing technology
Most of this can be done. If this is implemented, the sky is the limit in terms of market share and renewed interest from apps.
It just takes hard work, courage, some money and a good base to start from (which is already existing).