According to Joel Spolsky (JoelOnSoftware.com), the "single worst strategic mistake that any software company can make" is deciding to rewrite their code from scratch.
Joel was talking about Netscape/Mozilla. Now another of AOL/Timewarner's children has shot themselves in the foot.
Winamp used to be small, tight, fast, and nimble. It used to whip the llamas ass. Now, in the latest release, version 3.0, which was completely re-written from scratch, it is awkward and unrefined.
Winamp3 doesn't use standard Windows controls. You can't Tab through form fields. Over a year ago, I ranted about non-standard user-interface elements, skins, and how these decisions to build proprietary cross-platform interface controls make sense for programmers, but not for users. I could go on and on about this (look at this skin - what the hell is that!?).
They also win my Most Meaningless Icon of the Week award for their 'shuffle' control button. The button looks at times exactly like a 'volume' control, and at times exactly like an 'equalizer' control. What was wrong with the word shuffle.
I realize that Winamp is owned by AOL/Timewarner, but if their parent company fails to realize what it was that made Winamp popular in the first place, they will have wasted their $400 million.
The real winner here is Microsoft. Their Windows Media Player has always been bulky and slow. Winamp used to be the light alternative. The other alternatives aren't looking good either. QuickTime on Windows is a bad port from the Mac version and RealPlayer fell prey to the worst advertising saturation of any application in the history of software to the point where many refuse to even install it.
Having said all of this, it has been pointed out to me that Winamp2 was not very refined when it was initially released either. I'm sure Winamp3 will improve over time as well, but that's the whole point - they shouldn't have to improve.