I hear very little demand on a day to day basis from people wanting windows mobile phones. The people who want specific devices are almost universally asking for android and iphone.
And a little while ago everyone wanted blackberry's.
Microsoft are still preparing, it usually takes them a while to spin up.
They first got into the games industry with the Dreamcast by offering Windows CE as a platform for games. It wasn't as good as the native Sega development kit, but a few games were produced using it. Then came the Xbox, it was ridiculed for it's size & they didn't make any money but with determination they got the brand known. Now with the 360 I believe they are actually making money.
Windows had a similar gestation period. The NT project was always going to be the future, the 9x versions were stopgap to keep money rolling in. NT4 was the first user friendly one, 2000 was the first stable one, XP was the first where you could get drivers. Before XP it was tricky to decide which version to run, afterwards it became a simple choice.
I'm not saying Microsoft will succeed, but based on the past there is no reason why what they are doing can't work. It takes time to build momentum and although I won't be buying one right now, it will be interesting to see how it pans out.
I won't be buying an iphone either, a mid level android phone is good enough for me. However Microsoft have a knack at making things affordable and pretty good (given enough time).
