Borland announced this morning two big moves:
The purchase of Segue should help them better round out their ALM/SDO offering by being able to tout their own QA toolset.
Borland is looking for a buyer of their IDE products, one that will keep the business unit intact and allow the tools to be further developed. While this is sad news for those with Borland nostalgia, I think it'll be great for developers in the long run. Borland admittedly lost some of their focus on developers (which was the main focus when the company was founded) over the past couple years. A new infusion of attention and funds into the IDE's (C++Builder, C#Builder, JBuilder, and Delphi) should give the loyal followers something to cheer about.
This is a bold, but positive move for Borland. The biggest challenge now is getting all of these products tightly integrated together - no clunky import/export or field-created utilities. If that can get done in the short-term, along with Tempo, their story will be pretty compelling.
Now, how does this affect Microsoft's Team System offering? Not too much, actually. VSTS is, and will continue to be, the premier offering for .NET development environments. For one-stop, end-to-end SDLC solutions, Team System can satisfy all the major roles of the lifecycle. Borland may still push a "Developer" role in their offering, but now it will be by way of integrating with 3rd parties (Microsoft, Eclipse, or wherever their IDE's land).