"but Microsoft still has absolutely no competition in the directory space."
sure, only if you exclude LDAP, IBM, Sun and of course Novell, does Microsoft have no competition.
It's more accurate to state that *Novell* has no competition in the directory space.
Why? Because unlike the other directory providors above (including Microsoft), Novell's eDirectory is cross-platform on more systems. THIS is the true crucial element in picking a directory system.
Microsoft's AD requires a complete rip-and-replace of existing network infrastructures in order to get AD working.
That and the fact AD can only scale to a 100 or so million objects.
Compaq got Novell eDirectory to scale to over 1.6 BILLION objects in a single tree over a year and half ago. Novell claims the 1.6 billion object limitation (in eDirectory 8.5) was removed in 8.6 and 8.7.
The U.S. Army needed a directory system to run the authentication system to allow tankers to start up their M1 Abrams tanks. Guess which directory system they selected? Hint: Not Microsoft's.