Mitt has invested so much time and resources into Iowa and NH that he must win both places.
If Romney wins by a really close margin like this, it would be considered a loss. That said, if his and Guiliani’s support is so soft that Thompson’s mere entry into the race can covert it to a virtual dead heat between the three of them, then it bodes very ill for Romney(and Rudy) in January, when the real voting starts.