Steve Ballmer: World Congress on IT

Remarks by Steve Ballmer, CEO, Microsoft Corporation
World Congress on IT
Austin, Texas
May 3, 2006

ANNOUNCER: Ladies and gentlemen, please welcome the chief executive officer of Microsoft Corporation, Steve Ballmer. (Applause.)

STEVE BALLMER: Well, thanks. It’s a great honor and privilege to have a chance to be here with you today. I have to say I felt a bit of pressure coming on stage, as I heard the country and western band kind of banging it out, out there, and I’m thinking how do we make the transition from that back to information technology and key changes in society; I was sure glad I had the video. Although I have to say I was also thinking about all of you last night at a Lyle Lovett concert, and my guess is it was quite a different experience to be at this WCIT than it was the last one in Athens. Somehow I don’t think Lyle Lovett made an appearance over there.

I want to spend about a half an hour with you talking a little bit about the way we see our industry’s mission, the outlook for technology, and how all of that we think will really be a very — an increasingly, in fact, positive force driving society. And I want to give you that perspective and hopefully bring it alive with some interesting examples.

We talk certainly about our company’s mission, and we think perhaps even more importantly or appropriately as the mission for our industry is to enable people and businesses throughout the world to realize their full potential.

We embraced this mission about four years ago. Before that, we used to talk about putting a computer on every desk and in every household, and while that mission is unfulfilled — Paul Otellini from Intel and I were backstage even talking about that, in fact — I think what we learned over the period of time is computers are in more places just than in homes and on desktops, in pockets, in datacenters, in televisions, in other devices. And, in fact, that the core benefit that information technology brings is this benefit of being a tool, a grand enabler, and enabler of human imagination and innovation, creativity and productivity, that is extremely, extremely powerful.

And in a sense, if you will, I think probably the only other industries that might be able to claim to have a mission similar to this are actually the industry of government and the industry of education. Government and education, too, I suspect embrace this notion of enabling human potential as their core mission. But that certainly is the way the information technology industry has made its way.

When I joined Microsoft 26 years ago, the notion that people would have computers was still relatively foreign. I dropped out of business school to come to Microsoft, and my parents, neither of whom went to college, thought that this was a pretty silly idea, that I said I’m going to go work for a company run by a friend of mine that makes software for personal computers. And my father looked at me very earnestly and said, “What’s software?” And my mother looked at me even more earnestly perhaps and said, “Why would a person ever want a computer?”

Today, you can look back and say that’s a very odd and unusual thing to say, but certainly every day I continue to get stories and letters and e-mails from people who say, “I could not have started my business if it wasn’t for the personal computer.” “I couldn’t communicate with the rest of the world because of my disabilities if it wasn’t for my personal computer.” “I wouldn’t know what the best price is for my products if it wasn’t for the Internet and the personal computer.”

And this mission frankly is a very galvanizing one certainly inside our company. People come to Microsoft because they think they can do technology that changes the world in important, important ways.

I get asked frequently where are we in this information technology revolution, have we done about all we’re going to do to help enable human potential or is there more to come. After all, in just the last 30 years we’ve gone from not having microprocessors to having microprocessors but still having a fairly small market, to an explosion in the market for computers and Internet and new user interface, more accessible technologies; now we have cell phones. Even 10 years ago most of us didn’t have a cell phone, most of us didn’t know what the Internet was, most of us probably couldn’t have cared less whether we had broadband or narrowband access.

And it is legitimate to say will the next ten years be as powerful, new technologies enabling people to do new things. And I’ve got to tell you what we see as we look forward the next five, 10, 15 years is a world of technology that has the potential itself to be even more important in the positive change it enables in society than the last 10 years.

Computers will see, computers will listen, computers will understand, computers will really help you find what you’re looking for, to get additional insight, computers will help the world grow smaller and allow people to connect and collaborate in new ways. The technology engine, the semiconductor industry is going to continue to do its job of giving those of us who are on the software side the power and capability to transform the world.

We have a nice climate today. In many, many parts of the world we have a user community that’s ready to embrace what Bill Gates likes to refer to as the digital lifestyle, the digital work style. The computer should be a fundamental place we all turn for access to information, access to communications, et cetera. Our customers, our users are ready; they’re more ready in some parts of the world than others, and there are certainly questions of digital access and the digital divide, but the psychology and mentality is prepared to embrace these technologies if they bring the right benefit.

New business models: New business models will be important as new technologies are important. Things that get funded and paid for in different ways, advertising, subscriptions, financing, lower cost devices that are multipurpose in nature are all extremely important, and certainly as we look at the challenges of enabling all of the world’s population to have access to the world of digital information, we think new business models are as important as new technology.

The world’s information, business information, content, communications, media are all being digitized. The world of communication is moving to all use digital technologies for filtering and collaboration.

The new form factors are amazing. When we talk about how we’ll get access to digital technologies, to even folks with some of the lowest incomes in society, we think about powerful cell phones effectively that act almost as smart computers when you bring them near a big computer screen.

I know one of the themes for this meeting is all about health and healthcare, and certainly that’s an area where I think we can expect to see some of the most profound change over the course of the next several years. Healthcare is fundamentally an information technology issue. We need to give doctors, nurses, and other health practitioners the tools they need to get data about people, expert systems to help them decide what to do about that. We need collaboration and remote access systems so that even people who are not trained formally in medical techniques can engage in medical processes in rural and poorer communities around the world, assisted by doctors who may live in larger urban hospitals.

Medical records are all moving to be digital. All of the laboratory tests and images are moving to be digital. And unless information technology plays the critical role it needs to, healthcare costs will not remain manageable for society, and healthcare access will continue to be restricted to a relatively small percentage of the world’s population.

This is an area where we have great interest. We don’t know exactly how we should contribute, but we have a lot of people thinking through what the future of information technology looks like in the healthcare arena.

I think that traversing some of the big societal issues that face us, particularly as it relates to information technology, is an important activity for all participants, for government, for private firms like Microsoft and Intel and tens of thousands of others. I think that the issues of digital access and literacy, economic development through information technology, trustworthy and secure and private computing; those all do require a range of public-private partnership, and the more people that get involved, the more that governments open up for non-exclusive public-private partnership, the better off we all are.

I had a chance to first read about and then talk some with Paul Otellini about the incredible donation and contribution that Intel is announcing this week, and it’s one of these things where I say how really exciting for all of us, and the more that kind of activity the merrier, so to speak, the better society will be served by the information technology industry across these dimensions.

I want to talk some about all three of these, if you will, in turn.

I want to start though particularly on digital access and literacy with maybe a set of stories. Before I left for Austin yesterday I sat down with Craig Mundie. Craig is our CTO. Craig does a lot of work, spends a lot of time thinking through what will the future of technology look like in emerging markets, in poorer countries, in people without access, in healthcare, in education, in government.

And one thing Craig had never done before, despite his many, many visits to China, was actually go out into some of the poorest rural areas. And actually he just finished a week’s tour with representatives from one of our host ministries in China where they literally went in to the homes of poor farm families in rural China, and really watched what’s going on, talked to some of the people who live in those areas, tried to really understand what are the product breakthroughs and conceptualizations, what are the needs, what does our industry need to bring to that kind of environment to make its proper contribution.

We get a chance as a company to hear the stories of a number of people from across the world and across the social spectrum. I have down here on the slide I want to mention three specific cases. One is a girl in China, Zheng Cui Ping, 16-years old, living in rural China, family income of about $55 a year. The second is a fellow in India, Santosh Cheripalli, he’s 14-years old. And the last is the case of a fellow who lost his job as an insurance salesman in South Africa named Sibusiso Dlamini, and his story is also interesting.

All three of these people are participants in programs that somehow we’ve been involved in as a company to provide technical access, technical training and education to people around the globe, people who are in disadvantaged parts of their lives. Each of them has gone through a set of technology training. Cui Ping hopes to use that training to actually find an opportunity in university in China. Our fellow in India is very focused in on getting a higher paid job to help support his family, despite the fact that he’s only 14-years old. And I’m happy to say that after undergoing training at Soweto Digital Camp, our gentleman in South Africa is now productively employed, maybe not all that surprisingly, given the story, as a computer systems engineer; he has found his new passion in his new calling.

And it’s stories like these and many, many others that I think are good both for reminding us about the importance of digital access and literacy, but at the same time let us all feel humbled by how many people in the world still need to be touched in important ways.

We have two primary initiatives or primary programs that we run around the world, one we call Partners in Learning and the other is our Unlimited Potential program. And each of these is designed to facilitate education, training and computer literacy. Partners in Learning is targeted at traditional education in the classroom, and Unlimited Potential at community technology centers, community centers for people who are perhaps later in life and who need technology skills and training.

We’ve trained the trainer about 18 million times so far, and the target is to provide a level of technology access and skills in classrooms and community centers for about 250 million people by 2010.

The form of this is different in each of the hundred different countries and different communities in those countries, based upon the kind of public-private partnership governments in those places want to see.

We’ve committed about $375 million to these programs over a five-year period of time, and I think it’s another example of the kinds of things that a variety of different companies need to engage in to really push this issue.

The second area I want to highlight is economic development, which may seem out of character, but if you really ask in the United States, for instance, how important is information technology and job creation, the second largest employment sphere in this country is in information technology. Our industry itself is a big employer. Our industry is responsible for a lot of innovation that is used in other kinds of academic research, in e-science and biology and important areas to help push other social agendas, modeling, scientific exploration, resource, mining. And, of course, information technology is absolutely essential for improving not only business productivity but also government productivity.

And we spend a lot of effort in every country, every community in which we do business pursuing these agendas; a lot of partnership with research institutions on the applications of technology.

We have a community of over 250,000 business partners around the globe, from rural areas to urban, from large developed countries to smaller emerging markets. Probably the most important thing our people around the world to is get involved in technology transfer with local companies, who can then help really drive the adoption and use of productive technologies in those markets.

We recently kicked off a new wave of advertising that really is the kickoff for a whole new wave of innovation in our product cycle, Windows Vista, our new Office product, and these technologies particularly I think will allow our customers — business, healthcare, et cetera — to take the next step on being productive, well run businesses, what we like to call a People Ready Organization. And I do think this kind of role for information technology is extremely important in the development of societies across the world.

The last area I want to mention and talk a little bit about is Trustworthy Computing. About five years ago, four and a half years ago, we really I think received a wake-up call, the world is a world that had transformed. We were born in a world in which computers were largely islands, now they were on these networks, we had global networks that were interconnected, the Internet was primary, and it caused us to say — and Bill Gates sent out a very important memo to our entire organization that really security and trustworthiness more broadly, which includes privacy and a bunch of other issues, had to become our number one agenda item.

That’s not to say other forms of innovation are not important, but if we couldn’t give society the confidence that these systems were secure, that they would be reliable, that their information would be private and protected, that their children and employees would be able to go online and have a safe and proper experience, that the rapid uptake of these digital technologies would cease.

And so across our product line we really focused in on that. We’ve made tremendous strides in the security and resilience to attack of the systems that we provide, and Windows Vista will take another incredible and important step forward.

We’re building parental controls into our Vista release, because I think there is so much need and so much concern about letting children do what they need to do, get online, explore the world, find out what’s going on, participate in the digital revolution. But if you can’t count on that being a safe and proper experience, whether you’re in downtown Austin or rural India, it’s a big deal.

Third, we’re really doing a lot of work in our Vista release on phishing, identity theft. Business, commerce, interaction with government in e-government settings has to be able to proceed in a way that you know that your information and your identity are appropriate and protected.

There’s a lot to do still on the security and trustworthiness side. A lot of it is technologies like the kinds of technologies I described in our Windows Vista release. But it goes beyond that. In many parts of the world the laws need to be updated to really provide an appropriate legislative framework for safety and comfort of people being online. There are actually parts of the world where even child pornography online, it’s debatable about whether or not that that is clearly outside the proper bounds.

We’ve done a lot of work with law enforcement officials from the Royal Canadian Mounted Police to Interpol and others, training people on how to track and find bad guys online, including child pornographers and other folks that we might want to protect children from.

We’ve worked hard on systems that help law enforcement officials not only understand what’s going on, but to really track criminals who are engaged in these kinds of negative exploits online.

So whether it’s systems, core technology, policy, law enforcement, I think it is extremely important for our own company, our industry, and government broadly throughout the world to really embrace this notion of trustworthiness as a job one priority, and I was glad to see certainly this whole set of issues appear on the WCIT agenda for this year.

We live in an amazing time. The folks who gather for this congress are an amazing position, an amazing position to be at the hub and source of using information technology to positively transform society. A lot of that will be outbound, a lot of that will be in healthcare and economic development. A lot of it though, frankly, will be also in the productivity and efficiency of government itself, in e-government, if you will. And certainly our company, whether it’s in what you were trying to do for the citizens of the countries and communities that you serve, or whether it is what you are trying to do for the productivity inside your own organizations, agencies and departments, we are ready, willing and prepared to help in any and every way that we can.

It’s been a pleasure for me to have a chance to address you today. If you have questions or thoughts or things that you would like to talk about that we didn’t get to today, I’m steveb@microsoft.com, I’d love a chance to hear your feedback, your opinions, your points of view.

And with that I’ll say thanks, thanks again for your time. Many of you are great customers, thanks for your business. It’s been my honor and privilege to have a chance to be with you today. Thanks. (Applause.)

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