Microsoft is an "unstoppable" mega-corporation. Any legitimate competition is crushed by the might of Microsoft. Try to develop a for-profit operating system to compete with Windows and you'll get crushed. Try and develop a for-profit word-processor to compete with Word and you'll get crushed. Microsoft has reached the top of the food chain.
Legitimate for-profit companies cannot compete against Microsoft. Due to this fact, "free" software, such as Linux and Open-Office, has bubbled to the surface as the only possible contender in the evolutionary struggle against Microsoft. Providing "free" software is the only way to possibly compete against Microsoft. There would not have been a need for "free" software if Microsoft had not crushed all possible means of fair competition.
This lack of competition also hurts Microsoft because: a competitor, in general, only needs to be better than his next closest rival. If there are no close competitors then Microsoft does not need to improve. If it does not improve it will stagnate, whither, and die. It will be overrun by the weeds of small "free" software projects just waiting to get out from underneath the shadow of the mighty giant Microsoft.