Timing was definitely an issue - first Windows Phone came 3 years after iOS and 2 after Android. AFA the product itself, I think the perception it needed to overcome was more PocketPC/Windows Mobile having an incredibly substandard image in the market after the iOS release which seemed light years ahead, esp. since MS had that market to themselves for so many years.

That said, it got great reviews and they threw $$ at devs to develop for it, just couldn't gain traction. IME it was timing more than anything and by the time it came to market felt more reactionary than truly innovative.