Microsoft has sales of nearly $70 billion a year, annual profits approaching $20 billion, nearly $60 billion in cash, and is still growing sales around 10% per year.

But somehow, many people in Silicon Valley are convinced that Microsoft is going to collapse. Soon. Like in the next few years.

This seems crazy.

But we've heard variations of this argument enough times, from enough serious and intelligent people -- partners at big name VC firms, experienced executives, hungry startup CEOs, and startup gurus -- that we thought it was worth a serious look.

Here's the nightmare scenario that could keep Steve Ballmer and his minions awake at night -- and keep him working long hours during the day to prevent it.