By now everybody is familiar with Microsoft's strengths: Windows, devices, 'rich' user interfaces, partnerships with big media and electronics companies. Over the past few years we've seen Microsoft morph into a 'Services' company too, where services are delivered over the Internet. Although the branding as Windows Live has been clumsy and confusing, Microsoft has still been able to slot its Services vision into the Windows and devices foundation. Hence Gates' talk of "Services-connected devices running on the Web" and the "huge amounts of storage" that Microsoft is able to provide.

Products, Products, Products

Let's take a closer look at exactly what was announced...

This year Gates' keynote mentioned the following products:

• Vista - according to Gates, Microsoft has sold more than 100 million Windows Vista licenses to date.
• IPTV (Internet TV) - British Telecom, TNT and CNN have developed apps for Microsoft Mediaroom Internet Protocol Television (IPTV) platform; e.g. TNT has enabled users "to view NASCAR Sprint Cup Series races from the driver’s vantage point by choosing from a series of in-car cameras". CNN is also doing an app for the US presidential elections. Microsoft says Mediaroom is running on 1 million set-top boxes worldwide. It also announced a new offering called DVR Anywhere, allowing users to watch their recorded programs on multiple TVs in the home, and a partnership with Samsung for HD content streaming from TV to PC.
• XBox (see below)
• Zune - since the November launch of Zune Social, currently in beta, Microsoft says that "more than 1.5 million people have joined the music-focused social network", which it says is proof that "Zune is tapping into consumers’ desire to share their musical passions with their broader community." However, Zune is clearly well below sales of the iPod - so probably not too much can be read into this. It is though encouraging to see Microsoft trying to extend online music experience past the 'closed shop' of iTunes; that may compel Apple to open up their iTunes platform a little more (we can only hope!).
• a new GPS-powered version of Tellme, Microsoft’s "voice-and-visual mobile service" that enables people to use voice commands on their phone as input, then receive output back visually on their phone screen. The example given was that "a person can “call” the Web on a mobile phone and say “movies” and the software will recognize where the person is located and send to that mobile phone’s screen a list of the theaters closest to that location."
• the Surface touch-screen computer; it's UI was Gates' main focus, but he also showed how Surface can send images directly to its social network product, Windows Live Spaces. Gates told the BBC that "in five years we'll have many tens of million of people sitting browsing their photos, browsing their music, organising their lives using this type of touch interface."
• Voice-activated technology for the car; including Sync, an "in-car communications and infotainment system for mobile phones and digital music players that has been available in select Ford models since September."
• 3D mapping - according to Webware "Gates predicts 3D environments will go with you: In the store, on the street, and so on. Devices will, of course, know your location."
• Windows Live users: 420 million worldwide

Digital dream becomes reality: Gates and Robbie Bach jam with Slash; photo by jidnet

Partnerships: NBC, ABC, Disney, MGM

As is now customary with Microsoft, there were a lot of partnerships announced with big media and electronics companies.

The most notable is a deal with NBC on an Olympics '08 website built with Silverlight technology - Microsoft's cross-browser, cross-platform plug-in for delivering online video. The site will host more than 3,000 hours of live and on-demand video of Olympic events. It will be ad-supported, with Microsoft and NBC sharing revenue. The site will be at NBCOlympics.com on MSN; and it's being touted as "the official U.S. online home of the 2008 Summer Olympics in Beijing." Users will be able to get custom feeds of just the events they're interested in.

Another big partnership was with ABC and Disney Channel, for their programs to appear on Xbox Live Video. In other 'big media' action, Microsoft partnered with MGM to bring the latter's movies to Xbox LIVE. Both of these partnerships aim to bolster Microsoft's Internet TV ambitions for Xbox 360. Already Microsoft claims more than 10 million Xbox LIVE members, so the content deals will undoubtedly make the Xbox 360 platform more attractive - especially as they are high-definition. The company boasted that it will have twice the on-demand content than any cable or satellite provider. Clearly Microsoft is targeting Apple TV, although Xbox 360 is also fighting a double front - with Sony in gaming. Xbox 360 registered 17.7 million consoles this holiday season, more than Microsoft expected.

Conclusion

Mary Jo Foley from ZDNet remarked that this year's Gates keynote was less futuristic. I actually see that as a good thing, because it means we're seeing more actual products and services. Sure, we heard the usual talk about Windows software "connecting people", enabling rich UIs, device integration, and so on. But the number of real living products on display, and the equally impressive roster of big company partnerships, shows that Microsoft is delivering circa 2008. Although you could also fairly argue that Vista is still far from a success story and Zune is the poor cousin of the iPod still. Not to mention the Windows Live branding debacle.

Overall though, Microsoft's attack on the Internet front is paying off - particularly with Xbox 360 and its various Internet TV initiatives. Mobile is starting to look stronger too, with leaked info about Windows Mobile 7 showing support for an iPhone-like gesture interface. And Gates said in his keynote that Windows Mobile got "over 10 million new users last year, and we'll double that next year."

Microsoft is talking the talk, after years of the futuristic fridge taking center stage. Now, a Web-enabled fridge that plays Xbox games while sharing music with the Zune - that would be something...

Top photo: Joakim Baage