One of the most powerful aspects of free software is that its entire approach and mindset is orthogonal to proprietary software. It's not just better, it's profoundly different. That's one of the most important reasons that *everything* Microsoft has thrown against free software has not just failed, but failed dismally. The company can fight and win against more or less any conventional rival, since it has spent years honing its attack methods. But the latter are simply inappropriate when trying to compete against projects that are profoundly non-commercial: the community cannot be bought off or out; nor can it be undercut by selling goods at a loss against it. In fact, it is striking that along with undeniable strengths, the increasing commercialisation of open source has also brought with it vulnerabilities - notably legal ones - as some of free software's angularity has been smoothed down to make it more "acceptable" to enterprises.
On Open Enterprise blog.