Since we've just barely gotten English audio recognition at a good state (and I'm talking in general, not just Microsoft), there hardly should be any surprise that non-English recognition is where it is.
I don't see how "catering to the needs of customers outside the US" is related to "audio recognition" other than that one of them is a thing. If you didn't realize, Microsoft products are available in a dozen languages, and localization tests take a long amount of time as it is. As a company, it supports an incredibly large number of countries, more than almost all companies posted here on HN, and definitely just as much if not more than most in the world. Just because one or two products is hard to localize does not mean that Microsoft has "severely lost in the last decade to catering to the needs of customers outside the US".
I see that Microsoft can get their software translated. Yet that is very different from actually supporting a country.
Some examples of this:
I want podcast support in my Windows Phone. Because I live outside the US, I don't have it. I simply cannot understand why.
I want support for DVB-C Media in Windows, because that is the standard in my country. Because the US have other standards, my only option is using some half-baked korean crap receiver. I want to bet that the upcoming XBox One will not really work with TV in my country.
XBox Music is the new Music service from Microsoft. Guess how good the local music selection is in my country. How does Microsoft want to compete with Spotify here? Is this product even serious?
Bing is just no good outside the US. Yet it will be an important part of Windows 8.1, so I really wonder how this is gonna play out in my country when people start using it.
To be completely fair, Kinect Audio recognition is awesome.