Somewhere just after the turn of the millenium, PCs got ahead of software demands for regular office use, around the 1GHz processor timeframe. Then speeds tripled over a few years, and XP, which is was a pretty darned good OS, came along. Vista would have increased demand for new hardware, but it was a pig in every sense, not just in hardware requirements, and people shunned it. I think that miss, along with the general hatred for Office 2007 and the detestable Tool Ribbon, got people out of the habit of upgrading to get the latest stuff, and the old PCs worked just fine for most folks.
Now M$ keeps trying to find the mythical 'killer app,' while trying to force folks to buy into the Win8/WinPhone UI paradigm that everyone hates. I'm somewhat encourged by their gradual return of the useful bits of the UI they ripped out, but for about 99.9% of the population, upgrading from Win7 buys essentially nothing and costs time, money, and pain. Its not worth it.
It only takes so much iron and OS to browse the web, look at email, and write memos. A slow upgrade cycle is here to stay for the forseeable future.