It's a little simplistic, sure, but I mean how much nuance do you expect me to fit into a HN comment? What I left out is Windows Mobile, which was Microsoft's attempt to extend the Windows hegemony to mobile devices. Here are Windows Mobile's US market share numbers, per Wikipedia:
2004 11%
2005 17%
2006 37%
2007 42%
2008 27%
2009 15%
2010 7%
2011 3%
What do you think happened in 2007?
Somebody came up with better phone technology. Which would have happened anyways. Your argument was that it was necessary for Microsoft and now Apple to have a monopoly in order to create "necessity" for innovation, but Microsoft's monopoly was not driving Moore's law. The iPhone would have happened with or without Windows Mobile.