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Editor's note: This article is part one of a two-part analysis on the state of the front-end capital equipment industry and its future prospects.

First, both companies were fully committed to the fabless semiconductor model. That strategy freed up an enormous amount of capital that otherwise would have been dedicated to building huge fabrication facilities. More-efficient use of capital was necessary to their success but was not sufficient, in itself, to enable it. It had to be accompanied by disruptive innovation.

Microsoft has long had a business version of Windows for tablets with pen input that tries to pack full PC compatibility into the mobile device. It has failed to catch on in the core vertical users like insurance adjusters that were supposed to spark its broader growth.