While Microsoft may have trouble innovating, the company's acquisition of Ray Ozzie's Groove Networks clearly indicates that it can buy the innovations -- and perhaps innovators -- it needs to compete.

Like Google's purchase of Blogger and experimentation with social network software via Orkut, this deal shows the growing potential of peer-to-peer collaborative tools. Will Microsoft break Groove? Or will Ozzie help make Microsoft the next-generation company it might be able to be?