Apple's not terribly threatening compared to Google, in my opinion. Sure, iPods are kicking Zune's *, but they had a large headstart in terms of marketshare and mindshare. WinMo still has iPhone beat for marketshare though obviously iPhones have captured everybody's fancy. Google has more potential to disrupt Microsoft than Apple does.
Ultimately, Microsoft is its own worst enemy -- the complacency that comes with lack of real competition, the overhead and culture that comes with a very large corporation (90+K strong last I checked), and the inability to bring truly compelling products to market is more devastating than anything Apple or Google does. And when we do a great job, we have to outdo ourselves with the next release, something that's become a bit of a challenge lately now that Moore's Law has shifted gears a bit, and we've released umpteen versions of Windows and Office.