Microsoft has such a high level of not invented here (NIH) syndrome sometimes that I'd find it easier to believe that engineers on the ground are simply unaware of the competition.
That was certainly my experience in devdiv. People barely seemed to realize that a world outside the Microsoft ecosystem still existed. I have forgotten the details, but there was a meeting once where I suggested we look at some open source project for ideas about solving the problem we were working on... possibly LLVM?... in any case the response was completely blank, like, what possible relevance could that have, why are you wasting your time thinking about some weird open source thing in the first place? It was a really strange attitude to encounter, as someone who had never even used Microsoft tools before going to work there.
Matches my experience as well. I was there for nearly a decade, with several years in windows client, and I was always amazed that nobody there ever seemed to learn anything outside of microsoft tech. It's stunning how there are two almost completely separate worlds. Just taking web development as an example, outside microsoft, there's this whole culture of github, ruby, python, node, various open source frameworks, gems/eggs/npm. If you're a web dev outside of microsoft and you are completely ignorant of all this stuff, you're stunted. Whereas inside of microsoft, most people will stare at you blankly if you mention ANY of that stuff.
Mind you, none of this says anything about developer competency. There's no shortage of great developers at microsoft. They're just very insular and good at using microsoft tech and that's it. Oh, and these great developers are obviously hamstrung by the fact that microsoft isn't in the business of making great software, but that's a whole other rant.
Microsoft has such a high level of not invented here (NIH) syndrome sometimes that I'd find it easier to believe that engineers on the ground are simply unaware of the competition.