LAS VEGAS-Microsoft CEO Steve Ballmer used his Jan. 6 keynote address at the International Consumer Electronics Show in Las Vegas to give details on some of Microsoft’s initiatives heading into 2010, push the Windows-based ecosystem and demonstrate a tablet PC from Hewlett-Packard.
During the keynote, Ballmer referred to 2009 as a year of “economic turbulence,” implicitly acknowledging that the economic recession mauled Microsoft’s bottom line. However, he went on to describe his company as “bullish in terms of the long-term prospects of our industry.”
Ballmer devoted much of the presentation to highlighting several of 2009’s high-profile Microsoft releases, including Bing, the company’s search engine, and Windows 7, which he termed “the fastest-selling operating system in history” since its release on Oct. 22.
Early analyst reports suggested that Windows 7 was indeed selling well, with a Nov. 5 research note from the NPD Group showing U.S. sales of Windows 7 boxed software had exceeded sales of Windows Vista by 234 percent during the respective operating systems’ first days of release. The same report found that PC sales rose 95 percent between the weeks before and after Windows 7’s release.
However, Windows 7’s long-term prospects are more at the mercy of larger factors. In an Oct. 23 earnings call, Microsoft executives indicated that sales of Windows 7 would be heavily dependent on the health of PC shipments in 2010 and beyond.
A handful of research companies have suggested that Windows 7 will drive a generalized tech refresh sometime in 2010 or later, as the impetus of a new operating system pushes businesses and consumers to replace aging PCs. On the eve of the Windows 7 launch, about 80 percent of all commercial PCs continued to use Windows XP, according to a report by research company Forrester.
Ballmer also used the keynote to praise Bing, which he said had 11 million users. In a backhand swipe at Bing nemesis Google, he said the search engine was “not just trying to provide people with a list of links; we want to understand user intent and anticipate what users are really looking for.”
Echoing words from a speech in June 2009, when he termed Bing “the little engine that could,” Ballmer said Microsoft’s foray into search represented “the beginning of a long journey, but we think we’re off to a good start.”
In the coming year, Microsoft and HP will team up on search and Web portal applications, with Bing becoming “the default search engine on Hewlett-Packard PCs in 42 countries around the world,” Ballmer said.
Clouds and Tablets
Ballmer also continued to promote Microsoft’s consumer cloud strategy, in which the company’s software interface is ported across multiple devices such as smartphones, televisions and traditional PCs.
During his keynote, Ballmer helped demonstrate software that allows television content to play on PCs and Microsoft’s Zune HD portable media device. He also cited recent deals between Microsoft and automobile companies such as Kia, Fiat and Ford, all of which are apparently integrating Microsoft software platforms into their vehicles.
In the hours leading up to Ballmer’s speech, rumors filled the blogosphere that he would introduce a tablet PC built by HP. “Mr. Ballmer will show the as-yet-unnamed HP device, which will be touted as a multimedia whiz with e-reader and multitouch functions,” wrote New York Times blogger Ashlee Vance, citing unnamed sources.
Although many in the audience anticipated the tablet PC’s appearance, Ballmer held off on revealing that particular device until the very end of his presentation.
“Almost as portable as a phone, but powerful as a PC running Windows 7,” he said, holding the virtually button-free flat screen toward the audience. “The emerging category of PCs should take advantage of the touch and portability capabilities.”
Ballmer said the as-yet-unnamed device would be “available later this year” and would be able to display e-books, access the Web and play “entertainment on the go.” He did not give a price.
The tech world has been primed for the expansion of tablet PCs into the broader consumer and business markets, thanks in large part to the continuing rumors that Apple is developing a tablet PC due sometime in 2010. Although Apple has declined to offer any official confirmation about the tablet PC, further scuttlebutt has suggested that Apple would host an event in San Francisco during the last week of January to announce the device.
If those Apple rumors prove true, then Microsoft’s CES maneuver could be seen as an attempt to pre-empt-or at least lessen-the inevitable buzz that will accompany Steve Jobs walking onto a stage with a tablet come Jan. 26 or 27.
“Consumers are saying there’s no better time to be a Windows 7 PC,” Ballmer told the audience during the keynote. In any case, 2010 will likely be a crux year in showing whether Microsoft’s newest initiatives, such as Windows 7 and Bing, will actually thrive.