Hardly. Seriously, Apple have found a new market for themselves, and Microsoft haven't got there yet. That is all. Microsoft is still king of the OS, Office and Gaming Market. Apple aren't. Does that mean Apple are in decline as well?
Don't kid yourself that Microsoft are dead. They are far from it. I think they are under harder ground than Apple.
I think M$ is on a steady rise in the "cloud" arena...where all the buz is right now. Not only has Windows Server (and related products prolly) encroached on much of the traditional backend as IDC shows, but they also have their very own "Cloud Computer/OS" called Windows Azure. I also saw some charts in another thread somewhere were Windows is also growing in internet servers while *nix is declining. But "internet computers" are a pretty small sector really and a lot of this stuff will be virtualized anyway (i.e. many OS installs on one giant computer or cluster). And as you mentioned games...ever heard of Onlive? They went live last year streaming games using something to the tune of a bunch of Windows Vista running loads of modern XBox/PC games. That type of gaming market is slated to be a big player in the near future as many ppl can play without consoles or high end PCs. You're not likely going to see much OSX or Unix used to run games, especially if they want to open up an easy avenue for like old game devs to make money again off their 95% of games running Windows.
The've tried thier hand in the "mobile" arena as well, but although they dominate the industrial handhelds, they can't seem to appeal to consumers with the "Windows Mobile bloat". But now with Windows Phone 7, they seem to finaly get that sometimes "less = better".