Nobody wants to touch operating systems. The kernel is kind of scary to mess around with, and there just aren't many developers willing to do it. We've seen Linux users grow from 1,000 to 10 million, but the number of people working on the kernel has grown from maybe 100 to 200. And remember, the license prevents them from going too far. Everything they do has to be open source.
Any competitor can then come along and grab that code and add it to their version of the system.
Linux seems well-suited for server use, where knowledge of the system is necessary to get the best out of it. But the newest influx of users, including myself, wants a new option for the desktop. So far, my experiences have been very disappointing. People choose the applications they need, then choose the operating system. Microsoft clearly owns the desktop, because if you go to CompUSA, all the shelves have software for Windows.