Steve Guggenheimer: Computex 2010 Keynote

Remarks by Steve Guggenheimer, Corporate Vice President, Original Equipment Manufacturer Division
Taipei, Taiwan
June 1, 2010


Thank you for joining us today. On behalf of my colleagues that are here in the audience, and around the world, and our esteemed partners, many of them are here in the front row, I want to thank you for taking some of your valuable time this afternoon to follow us along as we share some of the work that we’re doing both here locally, and then around the globe, on the technology that I think helps drive all of our businesses forward.

My goal today is sort of to take us on a little journey. I want to start off talking a little bit about sort of what’s happened in the last year, specifically on the PC side, and Windows 7. We’ve had some good momentum, and some great partnership there.

I then want to talk a little bit about how things are evolving. And as you see from the stage, there is lots of evolution, and lots of great technology coming out, and how all of that comes together. So, I’ll spend some time sort of giving an overview, and then we’ll take a tour of some of the things that collectively are being built by many of the folks in this room, and really sort of walk through the technology that’s beginning to come together on behalf of both end users and businesses.

We’ll take a platform view first, and then one of my colleagues, Ryan, is going to come out and show us some of the experiences. So, we’ll look at both platform technology, and then some of the experiences that bring all this together.

After we spend a little bit of time there, I want to close out spending a little bit of time on cloud computing. It’s obviously a very hot topic here at Computex, and around the world, so I want to spend a little bit of time talking about some of the things we’re working on. It’s a keynote in itself, so I’ll focus primarily on the server side for this particular discussion, and some of the questions we get around the cloud, around container computing, and really sort of what’s going on on that side.

And then we’ll wrap up, and hopefully have addressed questions or ideas, and spurred some thought for the future.

I want to start off just quickly. You still end up in conversations around the economy. When we were here a year ago, that was probably the hottest topic amongst the CEOs, and the people in this room. You know, you can question where we are in terms of a rebound or the reset. I think globally there’s still a lot of discussion on the economy. The one good news, or the one thing I would highlight, is as I look back a year ago when we were here, as we looked at the PC hardware market, and the smartphone hardware market, and the server hardware market, it looked pretty hard core. It looked pretty bad. It was somewhere between flat to negative growth for the year.

A year later, the one thing that’s been positive is that the computer market, and the hardware market, really has come and rebounded. If I look at the hardware growth in Q1, over 25 percent growth in PCs in Q1. So, we’re seeing a resurgence, at least in the PC space, in the smartphone space, servers are coming along, and that’s good news. That helps drive business for all of us, and all of our partners that we work with. And the good news is, we can see some continued momentum on that side. And I think part of that is, we’ve got a good trajectory of hardware growth. We’ve had some good collective success using Windows 7 to help drive that. And I think we’ll continue to see some good energy around the PC space in the coming year.

When you look back a year ago, we were here getting ready to launch Windows 7. It’s all about your PC simplified. And if you look across the stage and some of the things I’ll show later, we worked very hard on working early with the folks in this room to really build momentum for 7. And the good news is, we’ve had some very good progress there.

There’s been over 100 million licenses or PCs sold with Windows 7 since the launch. So far, there’s been about seven licenses sold every second since the launch occurred. So, we’re seeing phenomenal growth in terms of the PC ecosystem. And the nice thing is, we’re seeing more and more variety of types of PCs that are coming out. And I’ll come back around to that as we go through.

But the good news there is, we see that momentum continuing. The nice thing is, on one hand, it’s good to see the growth of PCs, it’s good to see the positive reaction to Windows 7 and where we’re going; but the best part is, consumer satisfaction has been very high. Over 94 percent of the users of Windows 7 are satisfied or very satisfied with the product. So, we’ve been able to come into a point in time where the hardware market has been taking off a little bit faster than was predicted a year ago. We’ve got a good collective offering between our hardware and software together. And we have some good momentum heading into the next year.

As I look across consumer, commercial and new devices, there’s lots of things to be positive about, right. On the consumer side, consumer is still growing faster than business. We’re seeing good volume, netbooks and notebooks. We’re seeing touch take off, whether it’s on notebooks, or all in ones, or other types of devices, we’ll spend a little bit of time on the slates later on.

We’re seeing touch becoming a first-class citizen, or a first-class input type on the PC. Entertainment continues to grow, whether it’s photos, or music, or video, or television, more and more digital media, more and more digital content, more and more games, which we’ll come around to. And then we see new areas. Last year was HD, this year is 3-D, so that ability to drive very rich entertainment experiences that drive the best in hardware and software continue to grow. So, as we go into the consumer holiday season over the next six months, there’s good energy in the momentum in the space. We will do marketing in line in this particular area to help drive that momentum.

We’ll continue to see innovation in this particular area that we’ll help drive. So, we think the consumer momentum will continue. We will spend some of our energy and our marketing trying to help move that along. We will work with the partners in this room and outside of this room to come up with new innovations and new devices to help fuel that. So, we see consumer as a good market for all of us in the PC space.

If we then look over to commercial, we’ve got the tailwind of the consumer market, and then we’re starting to see good energy in the commercial space. It turns out that the commercial market, our partners, or our customers in the IT industry have been holding on to their computers longer than they ever have before, right. We’re three standard deviations off of the normal refresh rate for hardware over the last two years.

That says there’s pent up demand for refreshing computers in many, many corporations around the world, right. We also have a new version of Office coming out, and many times customers like to upgrade when they can do both the client and the Office product at the same time.

We have XP coming to the end of life and support. So, we have many factors driving what should be the opportunity for a commercial refresh. We’ve got good consumer demand coming from their end users. We’ve got good customer satisfaction, and now we’re seeing 42 percent of IT pros are beginning to deploy in 2010. So, we’re beginning that wave of refresh of machines that are in the commercial space. Forrester is forecasting corporate adoption to be ahead of expectations, and probably one of the best things we’ve heard so far is more and more people saying they’re not waiting for SP1, that the notion of having to wait for the SP1 in order to do the upgrade is no longer a relevant criteria.

So, now we have good consumer momentum, we’ve got good commercial momentum, and so as we look into the next year should be a good year on the PC side. Last, but not least, on the ISV in the developer side we have over a million applications now running on Windows 7 PCs around the world. So, we’ve had tremendous support not just from the hardware here, but from the software community in terms of porting applications over to Windows 7. So, everything is lined up. If we collectively do our jobs well, and we continue to sort of delight end users, build great machines and great software, have applications that are relevant, see more consumer media, we should see continued growth in the media, we should see continued growth in the PC space.

And given the volume of PCs today, if we look at 15 percent growth for this year, for the calendar year 10, which is sort of in the middle of the range between IDC and Gartner. We’re adding close to 15 million new machines into the market this year versus last year. So, somewhere around 350 million PCs would enter the market. So, very large number, that’s a very large opportunity for all of us and there could be potential upside there.

So, thank you. That’s sort of the simple word for that. We collectively could not have been successful without the tremendous support and partnership of many, many of the people in this room. The combination of hardware, and software, and solutions, and applications has really been what’s allowed us to fuel the growth in the PC space and give us a platform to build on for the coming year. And hopefully I can show you some things that keep you equally excited about the momentum we have for the future.

Now, after that let’s talk a little bit about sort of how we evolve and how we continue to grow, based on the momentum that’s there. First off, if you look back to the vision we discussed a year ago, one of the things that we’re very focused on is creating seamless experiences that combine the magic of the software with the power of the Internet, across a world of devices.

We have a tremendous opportunity to deliver the technology that at one point was only on the PC, and the content that at one point was only on the PC, across a much wider range of not PCs, but phones, TVs, and alternative devices. In order to help drive this, one of the things we do is we continue to do the best in R&D. We’ll spend more than any single company in R&D to help provide the innovation on the platforms from, which we can all build, whether it’s directly on Windows and the PC ecosystem, Windows phones, productivity, servers, entertainment, we will continue to invest R&D dollars in terms of creating a pipeline to help all of us grow our businesses as we go forward.

Now, how that comes to fruition in the next year is a pretty good year. Last year Windows 7 was a big piece of what we all worked on. This year we have many things that will complement that work. We have Office 2010. It’s the number one selling productivity suite in the world. We’ll get a demo of that later on, but that will help fuel both that commercial, as well as the consumer, upgrade space.

Today we’ll talk a little bit about the next generation of Windows embedded. We have Windows Live Wave 4 to help drive that consumer demand, so all the things that come in our services offering, instant messaging, e-mail, calendar, photos, video, movie making, all come together in the next release around our social side and the social networking. Windows Phone 7 will come out towards holiday this year and give a new generation in the phone platform.

As we get later into the year updates to both home server and small business server. So, while last year was very good with Windows 7, with Office 2010 a new phone, a new embedded, a new version of Windows Live, we have a lot of things to collectively fuel the growth in the business and hopefully delight and satisfy our collective customers.

Now, we have some very interesting sort of times ahead of us and some interesting opportunities in how we bring all this together, people have talked about convergence for a long time, and the truth of the matter is, technologies converge, but devices don’t. So, all of these devices start to share more and more technology over time, but we actually get more and more devices not less. At the same time we see more and more content going digital, right, we see more and more of the devices starting to move forward.

Now, as technologies converge, and we have more and more content, what happens to industries, because you have the content industry that’s participating in this change. We have all of the carriers or network operators participating in this change as they provide the pipes for that content. So, now whether it’s a cable operator or Telco they’re involved in this change, we have obviously all of the hardware companies or the device manufacturers, because all of that content flows through all of those pipes, all of those devices, and then of course we have software.

So, we have a very interesting time where the content providers are talking to the carriers, the carriers are taking to the hardware providers, and everybody is talking to everybody about how we bring all this together. One of our goals as an industry and as a company is to try and use software to help build the bridges between all of these changes, because what we really want as technologies converge is for industries to evolve in a way that works well for everyone.

We could end up in a world where industries collide, and that can get very difficult for everyone involved. But, if we can use software as a bridge to bridge between content and networks, between networks and devices, between devices and end users, ultimately all the way back to the people that create the content, and the power of the cloud and the magic of software hopefully we can help drive a period in time where end users see more benefit from all of the convergence than they ever have in the past.

Now, how do we do that? One of the things that we focus on is ensuring that we build platform software that allows every one of the devices that uses it to run really well. That means a phone is a great phone first and then can participate sort of in the ecosystem. A PC is a great PC first and then it can participate. A TV is a great TV first then it can participate. So, one thing we do is we work on platform software that sort of connects the hardware and the networking to make sure each one of these devices is great at what it’s meant to do first.

The second thing then is to have that platform provide an infrastructure for building experiences that bridge, because there are certain things, whether it’s photos, or music, or contacts, or other entertainment and productivity experiences that I want to bridge the devices. So, we work hard on building platforms to make the devices great and we work hard on building experiences that will actually bridge across the devices. And whether we build those experiences or other people build those experiences, that’s the magic over time.

It would be a terrible world if we had all these screens and it required a different way to interact with every one of them for some of the same content that we would want on them. At the same time they still have to be great at what they do. So, what I wanted to do today is spend some time on the platform side of what we’re working on, and then the experiences side to try and show sort of some of the evolution, some of the capabilities as these worlds come together, and all of the work going on in convergence, but more importantly, how do you build great platforms that enable all the devices we want to build and then great experiences that deliver the end user experiences that people will want over time.

So, with that what we’re going to do is we’re going to take a little tour around the stage. I’m going to go drop this clicker off, and bear with me I’m going to grab a quick drink.

So, one of the things that I think is hopefully evident by the stage is, technology converges, but devices diverge, which means we may see the same technology, but we get more and more screens or devices over time. And the question is, what do we do to make all of this work?

I’m going to start with phones, and then I’m going to hop around, and we’ll do some PCs, and some other things. So, on the phone side, phones are a very interesting industry. Smartphones are growing faster than feature phones, but they’re still the smaller part of the category. And we’ve been in the phone space for a long time. We have an offering out there today, Windows Phone 6.5, and you see a lot of offerings, HTC, Samsung, LG, Acer, Asus, Sony, people building phones using that core platform. Phenomenal innovation here, there’s some wonderful work.

One of the tricks is to try and have a certain amount of consistency in the phone such that developers know what to write for, and end users know what to get, and a certain amount of flexibility in order to make sure that there is opportunity for differentiation. And you can play that spectrum from complete flexibility to completely locking it down. Where certain other people in the industry lock it down completely, there’s no flexibility. But then, there’s no partner opportunity. And some things are so open that it fragments too much.

One of the things that will be coming next year is Windows Phone 7. And here what we’ve tried to do is strike the right balance between the work we’ve been doing on sort of some amount of flexibility to make sure there’s a great partner opportunity, but enough consistency that developers know what they’re writing for, and so they know they can write apps and it will work. And at the same time, the consumers have enough consistency that they know what they’re doing, and know what to expect.

Last but not least is taking some of the N10 services that are very popular, and making sure those are available on the phone as well, because those experiences at the end of the day are what drive the capability. So, for example, here we have Xbox Live available on a Windows 7 phone, and if you look at Xbox Live today, there are over 23 million users of that experience. So, having that experience available on the phone provides phenomenal capability.

If I go into Zune, I have the same capability for music. And I can scroll around in here. And if I go back, I can do my e-mail. I could go back into the marketplace. I could go into Windows Live and look at all my social media. And so, you see across Facebook, Windows Live, et cetera.

So, the phone space is evolving very quickly. There will be a lot of opportunities for Windows Phone 7 coming up. I’m not going to spend quite as much time on it today. But the good news here is, we’re taking the learning from building lots and lots of phones with lots and lots of partners, and mobile operators, putting together the best of an experience that has consistency for the end user and the developer with flexibility for partners to have differentiation, and then pulling in the world-class services like Xbox Live, like Zune, like Windows Live, then give it that richness that end users are looking for.

So, big change in terms of the model for phones. We still have our 6.5 out there as well, so people have that capability. And we think that over time, we’ll have sort of the best of both worlds as we move into the 7 timeframe.

Now, I’m going to skip past slates, and come back, because that’s sort of a hot topic. I wanted to move into the PC category. And one of the things we’ve seen with PCs, I’m going to start in the laptop space, is a phenomenal amount of innovation in the last year, both on applications that run on the PC, as well as sort of the richness of what we see up here. And you see things up here from MSI, from Acer, from Asus, from Lenovo, from HP, Dell is up here, you know this Onkyo, a GIGABYTE system, a Vila system, some of our partners in Korea Toshiba, Fujitsu, you know, there’s a Sony floating around. So, the innovation is very interesting. You see high-end design innovation. You see flexibility.

If I go across here, I want to start with this Onkyo, this is a very innovative form factor. You’ll notice that if I go in here, I’m going to open up an Excel spreadsheet, and one of the things that’s challenging as we have a smaller device here in terms of the screen is, I’ve got a big Excel spreadsheet, and I can’t see it all. So, one of the innovations here is, if I grab both sides of the screen here and pull it apart, I now have the ability to see that spreadsheet from one side to the other. (Applause.) And I think that applause is truly for Onkyo, because they did that innovation. They took the hardware, and created a very innovative design where now I get the best of sort of I’ll say a full screen laptop, but in a very portable size. So, that’s good sort of hardware/software innovation together.

As I move over to this device, this is just an HP  I shouldn’t say just  this is an HP Mininote, a very good sort of netbook sort of class device, along with our notebooks. And one of the things you see here is instant messenger. And Ryan is going to come back and show this a little bit later, but one of the innovations for the next year is across all of the instant messaging offerings, high-definition video is becoming the state of the norm. So, I have the ability with the software to do high-definition videoconferencing, and building high-definition video cameras, and make that as a hardware differentiation, or make them available as an add-on. And there’s work going on on the protocol side, there’s work going on on the hardware side. So, that’s sort of another level of innovation as we think about hardware/software integration.

Now, there are additional things that we can do. And so, on this machine, this is an Alienware gaming machine, so a very high-end laptop, very high performance. One of the things we’ve been working on is the next generation of Internet Explorer. One of the powerful things that’s available in PCs today is a separation of a GPU, a graphical processing unit, and a CPU, the core processing unit. And so here, what we’ve done is, we’ve actually taken IE, or part of what we’re doing with IE 9 is starting to allow developers, as they write websites, to take advantage of the GPU for very graphically intense websites. And as we think about richer websites, and we think about more media and more content, taking advantage of that GPU has phenomenal benefit.

This particular site is a very rich sort of magazine, photo website, and if I want to just sort of zoom in, I’ll click on a picture, and we’ll see it zoom in. If I want to zoom in again, I can go in. They bounce around, and I go out. Now, this is using IE 9 where it’s taking advantage of, again, DirectX and that GPU to make that transition smooth, to take a very rich, and I’ll say  I don’t want to say dense, but a busy website, something that does a lot, and make it move smoothly.

Now, there’s a browser here next to it that’s not running, it’s not IE 9. It’s an alternative browser. And it doesn’t have that ability to separate and take advantage of DirectX. If I take the same app and click on a picture, I actually did click it. And so, you see, it’s starting to move. So, for a website that doesn’t have that capability, that sort of capability to take advantage of DirectX, you’ll notice how much slower it gets. And I’ll pop in here, pick another photo. There we go. And so it’s moving its way out and in, if I go back out.

So, hardware/software advances don’t just stop, right, we continue to advance. And taking advantage of sort of the hardware and software together is a phenomenal opportunity. I saw a similar demo this morning, I visited AMD as they were announcing their APU technology. And where that builds both the GPU and CPU into a single chip, that type of advancement, you know, mapped with this type of innovational software is going to enable richer and richer capabilities, be it gaming, be it video, be it Web, and make that available to more and more people.

So, again, as we look across the range of devices, and we look across, in this case, the laptop space, we’ve got a great marriage going on between software and hardware innovation that’s going to continue to fuel the platform as we go forward.

Now, let’s switch gears a little bit, we’ll go into gaming. Gaming has always been one of those great tests for the capability of the computer, and one of the things that drives technology and innovation. You’ll see a number of gaming laptops up here. MSI, Asus, Sony, GIGABYTE, Acer, all very high-end gaming laptops. This GIGABYTE one is quite unique where it’s a standard laptop when you pull it out, but when you dock it, the docking station actually has extra power to make it a richer gaming platform.

I’m going to focus on the two that are down here. This one is an AMD-driven ATI machine. And one of the things that you see here is a racing game. Now, a lot of people focus on 1080p or high definition as sort of the best content that’s out there. This particular demonstration, using the processor here and the graphics card, is actually six times sort of the quality of HD. So, as opposed to running 1024, which would be about this size, you can see now we can run across multiple monitors. I’m going to go ahead and continue this game, and you get sort of the richest, most immersive experience possible. And I’m not a great driver.

I will tell you the truth, when I was practicing for the demo, I could make this the rest of the demo, because when you get it to the level where you’ve got sort of three screens  sorry, I’m not watching where I’m driving, I will go the opposite direction. I’m trying to flip it. The graphics are really good when you flip the car. I’ll stop here. But sort of this level of capability, right, multiple screens, very rich, immersive experiences, really taking advantage, again, of the platform, hardware and software together, DirectX 11 being put to its full use here. So, that’s one good example.

I’m going to sort of turn around here and show you another one. Here I’m running this sort of  this machine is called a Predator from Acer, so a very good, I love the hardware IDs that people do for gaming. This is a demonstration, this is some work that NVIDIA has done with us again on DirectX 11. And here I’m going to reset.

One of the things that’s happening now with the technology is you’ll notice the very rich graphics, we’re starting to get more and more physics built into the combination of what we support in the operating system and what our partners are building into the hardware. And so here you’ll notice I have my friend here who is on the front of this rocket sled, and if I change the view one of the things I can do is I can go to a wire frame view. And one of the things we’ve done with the DirectX 11 is we’ve gone to very sort of high-resolution ability through using triangles versus squares, something called tessellation, and the other thing I can do is I can actually turn on  I’m going to start this guy running along.

So, I’m going to add some thrust in and you’ll see the cart sort of pick up. It’s a little hard to see, and then he’ll start to move forward. Now, the nice thing here is they’ve actually added the physics in here. So, if I bring up the physics you can actually  oops. There we go. If you bring up the physics you can see what’s going on on this track. I’m going to reset. I’m sorry, my mouse is  OK. We’ll get them going again, get some thrust. It’s hard to see, because of all the white lines.

So, let me do the most logical thing and turn all off so we can actually see what’s going on, turn the wire frame off. Come on, there we go, turn our physics off, and he’s running along here, we’ll add some  we’ll add a booster, and we’ll eject him at very high speed. And we’ll scale back to see where he is, I’ll actually go to pilot, there he is. And he’s sort of floating around here and we’ll watch the  I’m not sure if he has a parachute or not. So, I hope he does. I don’t think he does. He does this over and over again. (Applause.)

The key thing which I won’t spend a lot of time on is rocks fall down, you can throw things, and you see the combination of the really good graphics mixed with the physics engine, so it actually takes whatever is happening and applies the physics against it so if a rock hits the sled it has the impact, and the forces change, and the sled will do whatever is appropriate using the pure models. And so as people are building games, as people are building sort of richer and richer experiences, that ability to apply very, very high-end sort of physics modeling into sort of the program itself allows for a very rich interactive experiences. So, when you see the 3D movies, and you see all the high-end games, this technology is enabling it, and again, it all runs on the high end of the PC market. So, now we’ve gone from sort of I’ll say standard desktops to very high end of the PC market.

So, now we’ve gone from sort of I’ll say, standard desktops to very high-end gaming machines, I’m going to slide over here and these are the all in ones. So, one of the nice things about Windows 7 is it’s provided a platform for more new types of machines. We saw a couple of the form factors on the notebook side, netbooks have been very popular over the last couple of years, but we’re seeing new categories. And if I look at the growth in PCs over the next years notebooks are continuing to grow faster than some of the other categories.

All in ones will grow extremely quickly next year. And I’m not sure what the Gartner IDC final numbers are, but we’re doing  you’re talking 40-50 percent growth year-over-year if not higher, right. Very good experiences here, these can be both a television if you wanted it to, as well as a PC. They can run Media Center. Here is an application, right. If I click on this, so, you’re all very familiar with mapping software, right, whether it’s Bing Maps, or some of the other maps that are out there it will allow you to sort of zoom in from the sky and then go and look at a particular area in whatever model. This is the exact opposite. This is the worldwide telescope, which looks out from the earth up into the solar system. It gathers images and photographs and all the information from telescopes from around the world, and allows us then to travel from wherever I was to Mars.

All of these are touch displays. So, if I come in here and I want to spin this around I can spin it around and look at a different view, if I want to grow it or shrink it, right, and I’m building all of that off the Web. So, now we get really rich touch experiences. Here we have an application that, again, takes advantage of the platform, takes good advantage of touch, right, takes good advantage of all of the hardware that’s here, has very good meaning relative to an all in one. So, where the desktop category has been shrinking this is breathing new life into that category as the all in ones become more popular.

So, now again we’re continuing to see the richness. Now, it’s a very logical bridge to go from the all in one type of PC device to television. Television is a very hot topic right now and some conversations are around 3-D TV. But, other conversations are around smart TVs, right. If we had smartphones becoming growing faster than feature phones, that’s going to happen with televisions over time. Very interesting question, lots of conversation in the industry, I think from our perspective the main thing is how does it participate in the experiences. It’s got to be a great TV first, the TV on the right I’m running TV. The first one I’m going to show you, one of the things we’re going to talk about a little bit later on is embedded software.

Embedded software allows you to build a very special purpose or fixed-function device using some of the technology that we already have, so taking the operating system and using it for a single purpose. What we’ve done here is we’ve taken our Windows Embedded Standard Edition, used the media center UI to create a set-top box that’s sort of integrates all the pieces. It has the television from whatever cable operator or network operator wants to build it, but then I can get at movies, I can get at music, pictures if I go down, if I go in I can look at pictures.

So, what I have then is a platform where one of our partners can build a set-top box, customize it for the operator, take advantage of some of the software capabilities that are inherent in the platform, optimize it for television for that operator and then give people the nice experience of having access to the content they’re used to in the house, right. Whether it’s their photos or their videos, Internet content, as well as the traditional television content. So, starting to blend it together, starting to build on the platform.

Now, I’m going to leave this one alone. If you think about set-top boxes we’ve had set-top boxes in the industry for a very long time. Cable set-top boxes, satellite set-top boxes, gaming consoles are a type of set-top box. They hook into the television, they allow you to do more with the TV than you have in the past, and Xbox, again, with 23 million Xbox Live subscribers, access to Zune content, it’s taking that television and allowing you to do more with it.

Now, this a very interesting device. When we think about innovation in the PC space this is an iView TV. You’ll notice that I’m watching TV, and the quality of the TV signal is not too great in here, but if I go into my input, and I can’t  there we go, and you see the source as TV, well if I scroll down you’ll see there’s another source here called media center, and if I click on that it’s switching me into the media center mode for a PC. And what this is is this is a device that’s built together both a television, as well as a PC infrastructure in the same device.

So, now when I want to watch TV I sit and watch TV like I would want to do at home, however there’s a lot of rich content today that people watch that isn’t coming over broadcast television. So, for example, if I go out to the website here, right, we’ve got YouTube loaded, and I can pick a video, and I can run the video. And so content  OK. We’ve got a couple of kids on YouTube. It’s actually a very funny video. But, the notion of having content just over the air, in terms of broadcast it’s no longer really true for what people want to watch. They want to watch the content that’s on television, but they also want to watch the content that’s on the Internet, whether it’s YouTube, whether it’s Hulu, whether it’s other content that’s out there, right, the other thing here is that I have the full access to the PC, right. So, if I wanted to go and launch the Media Center in the same way we saw a media center UI there, I have access to the Internet content. Here I have access to all of my Internet, or Windows Live  Windows Media Center content. So, the same photos, the same music, the same videos, and if I go into Internet TV, right. So, beyond YouTube many of the television broadcasters are taking their programs and making them available on the Internet.

So, now besides a television guy, I have an Internet television guy, and I can watch shows that they put up on the Internet. So, now I’m going to go ahead and minimize this. If you think about his television, this television gives me all of the access, and all of the rich content that television has to provide, and it’s a great TV with a normal remote control.

It also provides me all of the rich content from the Internet, whether it’s YouTube, or Hulu, or others. It also gives me Internet television. It also would give me access to all of those games that we saw in the other devices. It would also allow me to do an HD video conference. So, when I think about sort of the convergence of technologies, but rich experiences, this is a device that gives us access to both.

Right, so phenomenal innovation, and again it sort of starts to weave together all of the pieces. I’m going to slide down here for just a second, and two things over on this side, one along the bottom is a set of home servers. You’ll notice that across all of these demonstrations there’s photos, there’s music, there’s video. People are going to want to be able to share that content, back up that content, and store that content across the home.

So, whether it’s in the cloud, which is one offering, or whether it’s on a server in the home or both, having that backup for your personal files in your content becomes more and more important. So, allowing and working with our partners on building innovative home solutions is one thing we’re focused on.

The last one up here, I just want to show it, because it sort of talks about extending all of his technology on both the PC side and the server side, this is a Windows multipoint server. What it does is it allows me to a take a single PC, or server in this case, have multiple video cards in the back, and basically have a small box that connects each one of these monitors and keyboards to one machine.

So, when you think about schools, especially schools where you’re trying to manage a bunch of kids, it’s wonderful if we can buy a PC for every one of them. But if we can’t, we do need alternative solutions. This type of solution allows me to have, in this case, five students, I could have 10 students, all working off the same machine. It’s much easier for the teacher to manage one machine, and an IT person to manage one machine than it is to manage a bunch of different machines in a school. And so, from a management perspective, from a cost perspective, from a hardware perspective, this is the type of innovation that our partners are driving to enable, in this case, an education scenario. And this is sort of HP’s newest multipoint server offering. It’s getting very, very good feedback, if we think about schools in emerging markets, and around the world, very good innovation on the hardware side.

So, we covered a lot of ground. I’m going to come back over to this side. One of the interesting topics for this Computex has been slates, or pads, or tablets as a topic of discussion, and what I think about as a new category for the PC space. One of the things we should start with is, you know, devices like this, first off, they’re not completely new. This motion device has been around for several years. It’s advances in the hardware and the software that are going to allow us to do more. But it’s not a concept that’s brand new. The good news is, it’s innovation that’s going to drive it forward.

Now, one of the discussions that it has is, hey, should this device be primarily a consumption device? I take it along, it’s an extra device. Well, you know, it’s interesting where it could be a consumption device, over time, we think people will not just want to consume, but also be creative, and maybe be productive. And we’ve seen this before.

Two years ago when we were here, we had the conversation on netbooks. People said, netbooks, we’ve got a few of them here, they’re really a consumption device. People are just going to want to browse the Web. They’re just going to maybe want to do Internet e-mail, but they’re not going to want to do anything else. And so, it’s pretty much a different category. It’s not really a PC, it’s something else.

But over time what happens is, people take those devices and they’re like, well, I’ve done some Web browsing, maybe I want to do a little bit more, and maybe I want to do a little bit more. And maybe they want to run some of their applications, or maybe they want to use some of their peripherals. And it turns out, it’s easier to have it have the advantage of working with all of the things that are out there today, all of the applications, and all of the hardware, and to be able to be creative and be productive, and be consumptive, and it turns to that nowadays the netbook is sort of the lower end of the laptop space.

So, when we think about slates, we think gosh there’s probably some creative things people might want to do. So, I’m going to pull up this iMotion slate first. I’m going to start with sort of a design that’s actually been around for a while in the commercial space. I’m going to set it here, and let’s see if I can get the angle right so people can see. This is an application that comes out of our research group. This is a painting application. And it’s not an MS Paint finger painting. This has a stylus, and so we get to do ink input, or a pen input. If I pick the color tablet over here, I can put some ink on my brush. And you’ll notice, as I draw it runs out of ink if I didn’t get very much ink on. So, let me switch brushes here.

I will tell you now, I’m not an expert painter. So, I’ve got some ink on the brush. And as I draw, it will run out of ink. I’m going to grow this a little bit. So, this is canvas. If I look closely at it, you’ll see the ripples of actual paper. All right. I’ll bring that back down. So, the engineers who worked on this have sort of taken the stiffness of the brush, the number of bristles in the brush. They allow you to mix paint. I can take some paint and mix it in here, get some more, mix it in here, make my own colors, and grab some of this, here we go, start to paint around. I’ve got a different brush now.

I’m not sure that this is the app that I would use all the time, but very rich, creative types of applications. You can see, gosh, if I had a slate, and I wanted to do some painting, and I get something as rich as the canvas that’s here, and the work that’s done, that’s a very interesting, creative application. So, not consumption, but creative. And it makes a lot of sense for a device like this.

I’m going to switch sides, and I’m going to let the camera guys catch up with me. This now is sort of taking advantage of all the hardware innovation. It’s a very beautiful, very thin, very lightweight Sierra Expo slate. These are primarily prototypes, and this is running something called Copia. When you think about consumption in this case, this has mixed the best of book reading, the best of magazines  I’m going to slide over and I’m going to grab a book here  and it has a very rich format for looking at information, in this case from social networks, about that particular book.

I’m going to go back. If I want to look at my activities, I can look at my activities. And this is just research software. It’s starting to pull together social networks, a whole bunch of interactive content. If I want to go back in here and look at my tasks for the day, or my inbox, I can look at my e-mail.

And so, it’s very interesting again to think about the type of content and the way people might use a device like this. And, again, this is not a shipping application, this is something that we’ve been working with in research. But this is the type of device that will ship. And you’ll notice as you get the larger screens, you get a very sort of beautiful design. It’s sort of good weight, good to work with, and a very good job.

Here we see a bunch of other, an FIC device, I’ve got the Hanban system from China. In China, the Hanban is a very well-known company, they do handwriting recognition. They can use their character recognition software in a device like this, very good for writing on. One of the things that Windows does very well, especially in character-based languages, is it allows good character recognition. And so, when you think about writing, and going handwriting versus typing, devices like this will do a very good job, especially with their software.

Vila from Korea has been building slates for literally years. They make them for specialized applications. Here is a more generalized Windows 7 version. Here’s another device that’s being built. This one, again, from FIC. So, we have a number of them here, and there are more floating around the stage here.

A couple of days ago, Asus had a press conference, and they showed off sort of some of the innovation from a hardware design standpoint, where you might consider a slate of this style that ultimately plugs into a keyboard, or a docking station for a desktop.

So, the beauty here is when you take really good hardware innovation, and you take good software that we’ve been working on with Windows 7 and other applications, and you think about what you might want in a slate device, it seems logical to say, hey, all that stuff that you showed me, all the applications, all the capability, it would be nice if it could work on the device. I might not use it all. I might not need it all at the same time. But the fact that I can do it, the fact that I can use the software, I can use my peripherals, that seems to make sense.

And, again, one of the things we’ve seen over time is that as you get devices that are rich, people want to consume but they might also want to create, and they might also want to be productive. If you can do really good hardware engineering with really good software engineering, you can build something that does all of it. And Windows has provided the platform for building those rich experiences, and working with a broad hardware ecosystem that allows us to do all of it.

So, it’s a very hot topic at the show this year. It’s an area we’re investing with. We’ve got great hardware partners in this audience that have been working with us on this. We’ll continue to see innovation here, work with our partners. And I think what we’ll see over time, as we did with netbooks, is people might think of it in a narrow fashion to start with, but the more they see the possibilities and capabilities between hardware and software, the richer they’ll think about the experiences they want to have, and the richer they’ll want to take advantage of all of that broad work that’s been done already. So, good, good sort of run down across all the PC space, and sort of number of devices. The slate is, again, a very interesting area.

I wanted to end on our embedded space. One of the announcements we’re making at the show is that there’s a broad CTP or community technology preview available for our embedded offering, in this case the compact version of our embedded offering. We launched our standard a couple months ago, and that set-top box over there is built on that. Our embedded offering basically takes the core OS, and it makes it both componentized, and in this case this is our real-time operating system, it allows you to do different things with it.

For example, with our embedded software, you can build on other chipsets. So, this will run on ARM, it will run on Intel, it will run on a variety of chipsets. The good news is, it’s very flexible. The downside is, it obviously doesn’t have all of the richness of the ecosystem that the full PC ecosystem has. So, there are some benefits in terms of flexibility, but there is more work to be done.

As you can see here, there’s a number of devices. Here’s a Hanban book reader. So, where the slate over there is a full Windows 7-based PC. This is a compact-based book reader from Hanban, who is the number one e-book seller in China. This is a new Q Reader coming out. This is a Toshiba device, this is a MiTAC Mio, and I’ve got a few of these. And you’ll see, gosh, these look a little bit like single screen devices. Some people might even call these slates before they came out.

The nice thing is, with the flexibility of an embedded operating system, you can do more things. Again, there’s more work to be done.

So, one thing we’ve done here is, I’ve got sort of the new technology preview kit that we’ve worked with a little bit with some of our partners, and we’ve actually built some single-purpose, or in this case slate-type, devices using an alternative platform, in this case the ARM chipset along with our operating system.

So, I’m going to do three quick demos. This is sort of what the kit looks like. The nice thing about the work we’ve done is, you get the best of Silverlight, you get the best of Internet Explorer, you get the best of DLNA, some of the core pieces we have in our development environment, and you can build on those. The downside is, you do have to build it.

So, for example, this particular one just shows you a very simple UI, the kind of thing we would do just for building on. And I’ve gone ahead and launched the media player. We get to take advantage of the media player, because we built that component of software, and it’s built in. Here I’m going to use this particular device as a DLNA sort of client. I’m going to go to one of the devices in the house, one of the PCs. I’m going to grab some music off of that device. DLNA is a protocol that allows me to get media between two devices that support the protocol. So, if I want to put pictures on a TV from a PC, if it’s DLNA compliant, I can say Play To, use Play To technology in Windows 7, and off it will go.

Here I’m using similar capability. I’m going to do Play To of a piece of music, and it’s going to search around the house for devices that it can play to. So, it’s going to look for, in this case stereo equipment, and if you go to our booth, you’ll see a number of devices that are certified with Windows 7 logo program that take advantage of support for DLNA. And so it’s looking around, give it a second, this is obviously early build. So, it’s found this Sonos player over here, and if I click on that and hit OK, and it’s going to start playing off of this player.

(Music playing.)

So, that’s a very simple example of sort of taking an embedded device, and in this case building a fancy remote control is sort of what I did, with the ability to sort of take music from one device and play it on another. And that’s sort of step one.

Now, because we’ve got Silverlight in the development environment, there are a lot of Silverlight developers out there that can do richer experiences. So, this device, one of our Silverlight partners basically built a richer UI, it supports touch, I can scroll back and forth if I want to, and bring it around. If I want to go into the Internet, I’ll go ahead and click on the browser here. And it’s loading up Bing, and you’ll notice it supports two-finger touch, so I can scroll in and I can scroll down. If I want to go to the MSN page, switch my keyboards. That’s the second level.

The third one, this is, I’m supposed to be tipping these forward. This one is something we’ve been doing in partnership with Asus, where Asus has taken the kit, used Silverlight, and built a much richer user experience here. If I slide left, we can use sort of the gadget technology. You’ll see a weather map, Flickr and Twitter up here. If I scroll the other way, you can see a set of applications I might want to run. If I click on the reader here, I get access in this case to the Blio Reader. I can pick a book. If I click on it again, I get all the pages.

So, now we’re starting to build a richer type of experience. And so, the nice thing here is there is a flexibility to build on alternative chipsets, and build very rich devices. The flipside of that is, there’s a lot of work to be done.

So, from a Microsoft perspective, you know, technically, and technology-wise, we support a wide range of platform technology. The types of chips people might want to use, the type of systems they might want to use. We have platform support for that, and we build on what we do.

The flipside of it, when it comes to slates specifically, or things that are PC like, we generally believe that from a business perspective, it makes a lot of sense to sort of build on all of the capability that’s there versus creating things from scratch, where you have to create the full experience, and you have to create that broad ecosystem of content, applications, as well as all the device connections. So, we provide choice. That’s one of the great things platforms do.

And at a business level we also think from a business perspective we will invest in the things that allow us to extend the category. So, we will work to extend the PC category, we will support a wide, wide, range of devices and capabilities and we think over time as these things come together, that ability to have a phenomenally rich platform that allows all these devices to work very well together is going to help our industry continue to grow. And it’s going to allow us to continue to evolve and then provide end users with the things they’re looking for. Now, one of the things I talked about as I went along is that it’s very important to have a combination of hardware and software innovation. Right.

The slate category has been a hot topic. One of the things we wanted to do is be able to show some of the work that’s being done in our part of the space here. So, coming into the show we partnered with Asus and we asked Jonney to help us out in building some of the devices up here, and that really good partnership and that ability to sort of turns things around quickly, that’s the magic of what we can do based on the technologies that we have and the partnerships.

I want to run a quick video just a few words from Jonney’s. He’s been working on this around this particular category.

(Video segment.)


STEVE GUGGENHEIMER: My thanks to Jonney, and again all of our partners for working with us to show off what the magic of software and the magic of hardware can do when they’re brought together.

Now, this has been a pretty sort of broad display of hardware and software coming together at the platform level. The second part of this is how do you take experiences then that bridge across? So, what I want to do is switch gears, I want to have my colleague Ryan come out, and show us some of the experiences then that will help us bridge these devices.

Having all the devices is wonderful, having experiences for end users that allow them to work across different capabilities and content and different devices seamlessly is going to become more and more important over time. So, our collective ability to not just build great devices but enable experiences so our end users get the best of all this hardware and software is very important.

So, with that, I’m going to switch gears and I’m going to hand off to Ryan, and I think we’ll find Ryan — there he is coming from the other side. All right, Ryan, you’re up. I’m going to go off for a few minutes. Do well.

RYAN CALAFATO: OK, thank you.

So, I get the enviable task of showing you a wide range of all the software experiences that we’ve kind of got coming out this year. So, I’m going to get a chance to show you a day in the life of somebody who uses a PC at work, a PC at home, possibly a PC to play. And I’m going to start off by showing you some of the great innovations we have with Office 2010, so things that help an information worker do their work better and easier, some of the great stuff that we’ve got coming out that actually helps you share your primary documents, your photos and your media between devices, both using just your home network, PC to PC enabled by the Internet, as well as using the cloud in order to share those documents. And then last, I’m going to show you some of the innovations that we’ve got that are coming out both in Bing and also in some of the ways that you can enjoy home media.

So, starting off, I’m going to go ahead and start my day pretty much the way everybody else does, with e-mail, and for that I’m going to use Outlook. So, this is Outlook 2010. It is the latest iteration of our primary mail application, and for Microsoft employees it’s kind of where I spend my day. So, I start every day with a whole inbox full of unread messages, and the first task I have is to triage those and go through and figure out what it is I need to respond to and what not.

So, as you can see, I’ve got a lot of mail here. If it were a real inbox, it would actually be a couple hundred more. I’m sure some of you can relate with that.

One of the first things that we provide in Outlook that helps you to manage large quantities of mail easier is conversation view. So, I right-click here, choose show as conversations, and immediately what Outlook does is it takes all of my conversations and collapses them together.

So, here’s what happens: Someone sends an e-mail, somebody else replies to that e-mail, somebody else replies to that e-mail, somebody else replies to that e-mail. So, these are all on the same topic. Outlook is going to compress those together and show them to me on a topic by topic basis.

If I expand out that topic, for example, here’s tips on new smartphones, what I get is four sub-threads. So, here’s what happened there. As they were going along, someone replied and started off on a whole other thread, whereas everybody else kept replying to the same one.

So, I’ve actually got four separate conversations going on, on this one topic. And if you give Outlook another click here, it actually shows you a really cool view that can actually identify which messages are related to one another.

So, this is a pretty short thread actually. If you have a really long one, and you’re trying to figure out what happened and where the different threads diverged, you can actually find it. It’s kind of in the geek zone, but we definitely help you there if you have to deal with a lot of mail. That’s conversation view.

The next thing I want to show you is how you can help manage the size of your inbox, and also again the number of mails that you have to respond to. So, here I’m looking at conversations again, and I’m going to expand this all the way out again. I’m going to use a tool called cleanup. And what cleanup does is it actually goes through and looks at each of the messages — and I’m going to clean up just the conversation this time — look at each of the messages in the thread, figures out which replies included the entire first message. And you know what I’m talking about, reply all, reply all, reply all, and it keeps adding all the information. Well, those become redundant messages. All I need to see is the last message that includes all the information from the conversation. So, it deleted all but four messages, and I’m up to just the top of those.

If you go back to your inbox and you haven’t done this, and you’re close to your quota or your limit, and you run the cleanup wizard, you will probably save half of your inbox space. Fantastic tool.

Now, I have one more to show you, and this is my favorite one of all, and that is tips on new smartphones. This is one of those threads gone awry. You ever been on one of those, everybody keeps clicking reply all, and you’re hearing, “Please take me off this thread, please don’t talk about this again,” and it’s all become someone maybe sent out a picture of their cat. And you never want to see that cat again and you never want to see that thread again.

Well, we have a new button called “Ignore.” So, I don’t want to hear any more tips on new smartphones, and I’m going to click ignore. Yes, I definitely want to do this, and yes I want to ignore that conversation, and it’s gone. It’s in my deleted items bin.

You know what’s especially nice? Not only is it gone now, but the next person to reply to that conversation—right to the deleted items bin. I will never see another tip on new smartphones.

Yes, you should clap, because that one is awesome. (Applause.) Outlook has a mute button. How great is that?

OK, so that’s mail. The next thing in my world, and I’m in marketing, so I have to edit a lot of documents. Here I have a fact sheet about a new Windows Live Messenger product, Windows Live Messenger 2011. And I’m going to do just a couple simple things across our multiple Office applications. The first one I’m going to do is I’m going to make this one more visual. So, it’s actually got some photos up here, it’s got some information, it’s got some good copying, but what I want to do is actually make it even more impressive.

So, here I’ve got Windows Live Messenger running. I’m going to place my cursor right here, and I’m going to insert a screenshot. And you can see that it’s actually showing me all the available applications that are running that I can grab a screenshot from. Ready for this? Click, bam, there’s a screenshot. Click here, I’m actually just resizing it down to two. It’s not in the right place. So, I’ll go to position, show it to the upper right, there it is. Slide it down a little bit. One more, and there it is.

Any of you have to create documentation before or wanted to include a screenshot of an application? Now you don’t even have to leave any of the Office applications, you can do it from right within Word, Excel, or even PowerPoint.

Now, this is OK, but it’s kind of flat. Again, I’m in marketing, I want to add some pizzazz. So, let’s add some effects. I’m going to add a quick shadow. That kind of makes it pop out a little bit. And let’s add a reflection. There we go. Look better? OK.

Next Excel. So, here I have a simple budget, a simple home budget. Lots of numbers. Doesn’t really tell me where my money is going, doesn’t really tell me where I’m supposed to be paying attention. So, let’s add a little formatting that can help with that.

So, Excel 2010 adds a lot of simple ways of adding conditional formatting, colors that help you understand things. So, I just added conditional formatting, in this case a color scale, and the scale that I chose takes the big numbers and turns them red, takes the little numbers and turns them green. If you’re focusing on doing a better job at budgeting at home, you really want to be concerned with the large numbers.

So, that tells me what’s been spent, but it doesn’t tell me how I’m doing at getting better at spending. So, I’ve got a trends column, and what I’m going to do here is insert a sparkline. Now, what a sparkline is, is it’s actually a chart that fits in a cell, so it’s right to the point. I could turn this into a chart and have lines going all over the place, and if I was going to have a conversation with my wife or my kids about how much spending they’re doing, they’d look at the chat and they wouldn’t really get it. Here I’ve got a line that shows that my spending across my mortgage has been completely flat, the trend is the same, because the mortgage payment is the same every time. Because this is in a cell, I can use auto-fill and actually fill that trend line in for all the cells and for all the lines.

So, now I can start to see where some trends are happening. Here utilities are going down. It got hot in Seattle, it’s coming down a little bit, which is nice. Here trends are going up. Apparently we’re eating better, because my grocery bill is going up.

This is one way to look at it. I can also change the design so that we’re looking at columns. And that becomes even simpler to look at. And again these are trends of how the numbers are going up or down.

Very simple way of taking a complex spreadsheet and adding visual reference right into the cells. It may be a little geeky, but if you have to do spreadsheets, this is super helpful.

OK, now, the last thing I want to show you in Office is some of the things that you can do in PowerPoint. There’s been a lot of work done in order to make PowerPoint much more visual, and also add a lot of multimedia into it in order to make it very simple to work with multimedia and also edit it, make much more powerful and beautiful presentations.

To start off with, this is what’s called Smart Art. What we did was took simple — it allows you to easily and quickly make graphics, either from existing lists or if you want to create additional graphics, things that will add visual elements in order to make your point.

It’s also a great way of formatting what can be fairly flat data. So, here I have a simple list. I’m actually going to highlight it, right-click, and convert this to Smart Art, very simple list format. I can resize it very easily just by dragging it to where I want it to fit. And then here comes the fun part, up here simple click to change the format so it’s nice and shiny, something else I can do in order to change the colors, and I took a pretty boring list and quickly make it into something a little bit nicer.

So, that one is nice, it’s really quick formatting, I don’t need to open Photoshop, I don’t need to ask a graphic designer, I can just make that happen.

The next thing, this is a little bit more impressive. So, video in PowerPoint and photos in PowerPoint are definitely not only a trend, but they’re increasing in usage. If you can make a presentation multimedia, you can definitely create more impact.

So, this is a simple video that I added into this PowerPoint file. And you can tell what the topic is. Basically the topic in this PowerPoint is wildlife. So, this is a presentation that I actually started out as my daughter’s presentation, and I stole it so I could use it in a demo, because it was simple.

My daughter likes horses, and she doesn’t particularly care about the rest of these animals. So, what can we do about that? So, I’m going to take the video, go up to playback, and I’m going to trim it. So, one click, it brings up the trim controls, and the first four seconds of that video are all about horses. So, I just trim it down to about four seconds, click OK. PowerPoint takes a second, makes an edit, and you’ll see that now this video is only four seconds long.

One more click — (applause.) Ah, there you go. I knew it was coming. I wasn’t sure if it was going to be this one or the next one.

I’m going to make it start automatically, and this is all just with playback controls, and there’s more you can do here. And I’m going to format it. So, video is what we call a first-class object in PowerPoint. I can add formatting to it the same way as I can graphics or photos. Let’s go ahead and tilt that, make it a little more impressive. See that reflection there? It’s pretty nice. OK, what’s it look like? So, start here. Oops, Messenger popped up. Back. OK, let’s go back again.

Click here, we can see my animal food chain. Lions eat, people eat sushi. Too bad we’re not at the top of that one. Here’s my — what is that, about 20 second format for my list? That looks like it was done by a professional. There’s my video playing. Notice the reflection. It’s actually playing in the reflection, too.

And I’m just going to keep going, because now I’ve got a few transitions in here. What you’re seeing are the new transitions in PowerPoint 2010. We have quite a few of them. These are actually using the GPU on the PC for acceleration. So, you can get some really great transitions happening very smoothly, and that’s all just taking use of the hardware that you guys put into these devices so that we’re not wasting all that power and all that innovation that’s going on, we’re actually using that in order to make the presentation go better.

So, that’s PowerPoint. (Applause.) There you go.

OK, one more cool PowerPoint feature, and this is one of my personal favorites. OK, you walk into a meeting room, you’ve got your laptop, you sit down, you plug it into the projector, and it doesn’t work. In fact, the projector is not even turning on. So, you’ve got a bunch of people in the room that you need to talk to, and you’ve also got some people that might be at home or in other countries, and you want to present a presentation to them as well. Like I said, I’m in marketing, so this one hits me where I live and breathe.

I’m going to show you a very, very, very cool trick. It’s called PowerPoint Broadcast. All I’m doing is bringing up a PowerPoint presentation. I want to make sure this goes quick, so I’ve got a little one. I’m going to click broadcast slideshow, and watch how easy this is: start broadcast. OK, what’s happening? PowerPoint is taking my presentation, packaging it up, and uploading it to Windows Live.

Let’s go here, start broadcast. So, there were some network issues with the Internet a little bit earlier today. I think we’ve got them fixed now. So, let’s see how we go, get that on up there, there we go.

OK, so here we have a link. This link is to an Internet location. Anybody can connect to it who can connect to the Internet.

I’m going to copy that link. I’m going to cheat and do a little foreshadowing, and go to Hotmail. And I’m going to send that to my own account. Broadcast. I know you don’t care if it’s spelled right, but it still bothers me. All right, send that to myself. OK, message has been sent.

Over here I have a netbook. I’m just going to quickly refresh so I can get my updated mail. Just logged into the same mail account. Here we go. So, here’s my broadcast link. OK, with one click, all right, and it’s loading up. Give it just a second to pull that down. Now, as I said, we were having connection problems up and down a little bit. This one is probably going to have to find the Internet again in order to get the file. OK, and here it goes. Bam. All right.

So, this application, this actually works in any browser. Notice what it says in the text. It says waiting for broadcast to begin. Even though I’ve sent, uploaded this presentation to the Internet, even though I’ve made it available to anybody who’s got an Internet connection, I still have full control. So, I’m going to click start slideshow, and bam. I click to the next slide, and bam. (Applause.) Doesn’t cost anything, don’t need any special hardware, don’t need any special software, away we go.

And when I’m done, I click end broadcast, it says are you sure, and — well, any second now this is going to say broadcast ended. There we go. OK. Voila. So, that one is absolutely my favorite in PowerPoint. That’s not true, the video editing is actually my favorite, but that’s the one that gets me out of trouble the most often.

All right, so we just went through Office, saw a little Outlook, some of the easy ways that we make it to manage your e-mail, showed some of the interesting and rich editing tools, and I showed that across the different applications to give every one of those applications a little bit of love, and showed some of the ways that we’re making presentation richer, and the last thing I did was actually one of the easier ways that we have of sharing content with other people, as well as with ourselves. So, I’m actually going to continue on that theme, and show a couple more ways that we can share information between PCs.

So, if we can take a look at the netbook again, and I’m going to go ahead and bring this up here, too, I have an application loaded on both of these computers called Windows Live Sync. What Windows Live Sync does is it actually lets you select folders full of content, documents, videos, music, photos, and keep them in synch between devices that you own. So, this is a way of creating my own little personal cloud of my own little information, so no matter where I go, I always have what I need.

OK, so I’ve got a photos folder here. I’m synching the My Pictures folder. These are some photos that we took while we were walking around Taipei waiting for the event to start. I’m just going to drop that folder here, and here’s what’s happening. So, the first thing that happens is the Live Sync client that’s on my netbook computer noticed that I added something to a folder that it’s supposed to be synching. It connects up to the Internet, and allows a service to know, the sync service, hey, I’ve got new content. What that does is it notifies all of my computers that are currently connected that are also running Live Sync, and that are also configured to synch that folder, and says, hey, we’ve got new stuff. And what this computer just did was it said, oh, there’s new stuff over at the netbook, and it actually went out across the Internet, found that computer, and made a copy of it, and you saw that folder hopefully pop up right here. So, here we are, here’s my Taipei folder. That’s in the lobby of my hotel. That one is at a temple. Nice waterfall.

OK, so what I just did was synch computer between my two devices. So, shared a PowerPoint out using the cloud, went ahead and created my own personal cloud using the Internet in between. The next thing I want to do is talk about another way that you can share information between folks.

In this one I’m going to use Windows Live SkyDrive. So, I’m going to go back to that Excel document. And I just saved it locally, so I’ve got those changes there. But now what I’m going to do is save this up to SkyDrive. So, I’m going to save this actually to the Web. I might get actually prompted for a login. Nobody get alarmed, it’s OK, I know the password. I just want to make sure. Go to public, and I’m going to go ahead and save this Excel document to that public folder.

So, here’s what happens. Excel connects up to the cloud, finds my Windows Live SkyDrive account, goes ahead and authenticates and logs on, and then provides me with a save location.

The path that I’m going to be saving this to is actually in my SkyDrive, which is my 25 gigabytes of free storage space in the cloud. So, I can save. It’s contacting the service again, authenticating again, and it’s actually going to copy this up and it’s going to be waiting for me on SkyDrive when I go to look for it in just a few minutes.

OK. Now take a pause from Office and a pause from sharing for a second, and I want to show you a new application that was recently announced, Windows Live Messenger. So, one of the things that I know here, and one of the things I know about usage is that lots and lots of people that are here use an Instant Messenger client every day.

So, what I want to do is show you a couple of the new things that we’ve been doing with Windows Messenger to actually really affect the way that people share information and communicate with one another.

So, first I’ll start at the top. If I add a status, onstage in front of a thousand plus people, demoing Messenger. So, this is my status. I’ve linked my Windows Live account to my Facebook account. So, when I click share, I’m actually sharing that status message not just to my Windows Live network, but I’m also sharing it on my Facebook account as well. And we have more services that you can connect up into Windows Live Messenger as well. So, I can actually immediately post and share information to all my social networks at once. That’s one.

Next what you see here is the new Messenger window. This is what you remember, which is all about me and all about my contacts. This is what’s new. Over here on the left is all the updates that are happening in my social network. So, here Harry shared a photo up on Facebook. This is a photo album that I actually sent to myself using Hotmail, which saved those photos up to SkyDrive. Notice I can actually enjoy those photos just by hovering over them. If I had video inline, I could go ahead and play the video.

Here’s Harry on his zip line. I want to try, too. Now what I’m doing is actually commenting on this Facebook photo, but I’m commenting inline in Messenger. That comment is actually showing up on Facebook though.

So, one dashboard, one location where I can actually get all of my social networking updates, and I can actually comment and interact with my social network at the same time, and my whole social network, even if that’s multiple services.

So, that was just a quick thing in Messenger. Now let me go back to the Web. So, I’m going to get in the browser and hang out there for a while. So, let’s start with SkyDrive. Give that five for a quick refresh. All right.

Now, just recently I saved an Excel document up to the cloud, right? OK, here’s the new one. I’m going to click this. Now, here’s what’s really cool. Now, this is up on the cloud, and I can download it, which is there are a lot of cloud-based services for storage. But let’s take a look at what’s special about this. So, I just clicked on that Excel document in order to bring it to view, I click it again, and now within my browser I’m going to be able to view that Excel document.

Now, what’s great about this is if I wanted to share this with somebody who doesn’t have the latest version of Office, doesn’t even have Office on that computer at all or is borrowing a computer or using a kiosk computer, I can still give full fidelity and get full access to this.

Do you see the document, by the way? So, here we are. Here’s real Excel, here’s Excel Office Web App. Full fidelity document, full editing capabilities. If I click here, I can actually edit this in the browser.

So, here we add a lightweight editing shell on top of — oh, you know what the problem there is? I’ve got to close this. It’s even smart enough to know that I had it open. Let’s try that again. There we go.

And edit in browser. So, what I get is a lightweight version of Excel that I can actually use to interact with this document, make editing changes if I need to, and I can do that right in the browser. And you’ll notice I get the ribbon UI, and I get some of the most common things that you’d need to do. If I need to insert a row or insert additional tab options or table options, I can sort and filter, I can do that right here. If I need to make an edit, I can go ahead and make an edit. So, let’s change this to 100, for example, and bam, I’m able to make edits right here. These are actually being saved directly to the SkyDrive account right away. So, I can make lightweight changes if I need to without any problems.

So, that allows me to share my documents off with other people. If they have access to my SkyDrive, and I give them privileges, they can read my documents and even make edits if they want to.

All right, let’s go ahead and talk about another cloud service that we have that’s part of the Windows Live family, so Windows Live Hotmail. This is something that we recently announced, Windows Live Hotmail, part of wave 4. The new Hotmail has a lot of new features and new capabilities that make it very simple for you to manage large quantities of e-mail. I actually just talked about that with Outlook, too, but let’s talk about how Hotmail is helping us do that for personal mail.

So, I have conversation view. I click that, give it just a second, and Hotmail had gone ahead and compressed my conversations, so it’s simple for me to read e-mail threads. Here’s the beginning of the thread, here’s the top of the thread. We go back to the beginning.

In addition, there are some simple views for drilling down on different kinds of mail in my inbox. So, here I can click unread, and from here I’ll see only the unread messages in my inbox. Click here, and I only see messages that come from my contacts in Live Mail. Click here, only social media updates.

Since a lot of people use their personal e-mail accounts, in particular Hotmail, for a social media contact list, then this is a good place and I have a good management tool for managing those updates that come in.

And I like this one a lot, because this one says everything else. So, if it’s not from my contacts, it’s not a social media update, and it’s not from one of my contact groups, and it’s from something else, it’s not really spam, because we actually filter all the spam out in the junk mail. It’s more ham, so mail that I want, but I don’t necessarily want to read all the time. So, that’s a view that you can use for that.

Let me go back here and let’s take a look at a photo mail that Harry has sent me. OK, a quick data point. What is the number one way that people share photos with one another using a computer today? Anyone? It’s e-mail, still, by huge volumes, like by more than 65 percent. E-mail is still the number one way of sharing photos with one another.

So, in Hotmail we made that much easier and a much better experience. So, Harry has sent me this photo mail. I have gorgeous thumbnails of the couple photos that he has sent me.

These are just thumbnails in my e-mail, very lightweight mail, not a lot of storage space required. When I click on it, it actually takes me to a slideshow view.

Now, here’s what’s interesting. This slideshow view is actually looking at his SkyDrive. Because what happened is when he sends me a photo mail, it uploads the full resolution version to SkyDrive, same place that I showed you that Excel document before, and gives me this really beautiful Silverlight player that I can use in order to enjoy a slideshow. Click here to go full screen. You’ll notice I can navigate from photo to photo very simply. The backlight, as you notice, is actually selecting a complementary color in the photo, so that it kind of makes it easier to view, especially if it’s a little bit dimmer. Really gorgeous way to experience photos.

And this is really easy to do. So, I’m going to go ahead and click new mail here, and just show you what it’s like to do that. All I do is click a new mail, click photos. I want to create an album on SkyDrive.

Now, I can do this with photos I’ve already shared online or I can do this with photos that maybe I’ve just used Live Sync to copy to my PC from the computer that I pulled them off the camera with. And watch what’s happening. I just added these photos. They’re actually being uploaded right now to my SkyDrive, and added to a folder that will be accessible only to the people that I send this mail to.

So, wait for that to be done, send that one to myself. One more photo, there we go. Let’s do this. OK. Click send. All right.

Now, if I wanted to, I can click here to go right to that album. If I go to my inbox, here’s my photo mail, and there you go, automatically makes nice thumbnails for me, makes it simple. I can either view a slideshow or — and this is my favorite — when you send this to your family and they want these photos, they want their own photos, you just click that and they can download all of them as a single zipped file if they want. Supports up to 200 photos at a time, up to 50 megabytes per photo. Excellent feature.

OK, so that’s Hotmail. That’s Hotmail. Those are some of the ways that you can share information. The next thing I want to do is show you some of the innovation that we’ve been doing online.

So, first I’m going to go in and show Bing. So, this is Bing maps. Many of you have seen this before. Silverlight based application, very easy for me to scroll around, really gorgeous views. And as I’m scrolling around, it’s actually picking the best way for me to view the information based on the data that’s available.

So, I scroll down really close and click a feature called Streetview. Now, what Streetview does is it actually puts me on the street wherever it is that I’m looking. This is a great way to do virtual tourism, or if you have to drive someplace, kind of look around so you can see what’s going to be around you when you get there. So, that’s neat.

The next thing I want to show you is how we’ve integrated some of the social networking applications into Bing. So, that was one application I can show. We have another map app. Everybody heard of Twitter? I can click that. This is actually showing me, as you can see, I’m in Taipei. So, right around here these are all the location-based tweets that are around here. So, lots of people using Twitter. I can hover over this. About two hours ago, was a post from John Norris. Hopefully it’s clean. Yes. OK.

Over here on the left you’ll actually see tweets showing up in real time. So, now I can not only go someplace and see what it looks like in real life, I can actually take a look at a particular location, see what’s happening right now.

Next piece. This is a search that I did for the Metropolitan Museum of Art. So, here it is, I’m looking at the top of the Museum of Art. This is not very interesting, and I think I was talking about virtual tourism before, right? If we look here, what we’ve done is an application has actually integrated something called Photosynth, which is a cloud-based service that we use or that Microsoft offers. You can upload lots of photos that you take of a particular article of interest or an area of interest, and we’ll stitch those together in order to create an experience out of them.

So, here we’re going to look at a Van Gogh. I’m just going to scroll in, and you can see these are individual images that have been taken at different resolutions, but we stitch them all together into one.

But what’s cool is you can get pretty close to the point where you can actually see the brushstrokes in this painting, and I can do it from here.

So, anybody can upload a Photosynth. In fact, some folks have. And if you add location information to them, we’ll actually show it up on Bing maps. This is a Photosynth that was made from the top of Taipei 101 in the observation lounge. This is literally a 360 degree view. And I’m just scrolling around. Pick a particular location, and as I scroll in, the photo will resolve into higher and higher detail. So, I can kind of do virtual tourism there. Pretty cool? All right. (Applause.)

The last thing to talk about is some of the things that we’ve done to make home media even better. So, before I left home, I actually downloaded Avatar using the Zune marketplace on my PC here. And when I got here, we connected it to a home network, and using Home Group I can actually use a variety of devices in the home in order to access them. So, you can download once, and you can play to multiple devices.

The first thing I’m going to do is show you on this iView Media Center. So, we’ll scroll down here. I’ll start the Media Center application. Go to the home screen, and I’m just going to navigate up to pictures and videos, show my video library, and then over here to the left there’s the movie.

So, this shows up because it’s actually in my home group, and the iView is able to see my Home Group, see the media that’s being shared across my Home Group from any of my PCs.

Here’s an Xbox. This Xbox is actually looking across the network, and looking at the media that’s on this iView TV. When it sees that, I’m able to play it here.

OK, so that’s one way of doing it. That’s buy once, play anywhere. That’s pretty cool. Now let me show you another piece, and this is a little bit more future focused. I’m going to close that down, and I have here — uh-oh, it didn’t go away, it went to sleep. OK. My next one went to sleep.

OK, so we were able to buy the movie Avatar on that PC, view it on this PC via the network, see it from my Xbox. There is one more location that I’d really like to be able to watch media. And you want to be able to have access to that media on all the devices that you have available in your home or in your life.

I’m going to come over here and pick up this Windows 7 phone, because I got to carry this to Taipei, which was awesome. And before I did, I made sure to plug this in and synch it, so that I could have access to all my Zune media from one location.

So, there’s this same movie that I purchased before on my PC, and I can view it across all of my devices, and I can also view it off my Windows 7 phone.

I’m going to take this with me, and thank you very much. (Applause.)

STEVE GUGGENHEIMER: Thank you, Ryan. Great job.

Well, Ryan covered a lot of territory there, a lot of good stuff. The interesting thing is you’ll notice towards the end the same content, PC, TV, phone. As we think about what our customers are going to want in terms of experiences, those bridges are important.

And you saw a lot of services there, from Office to Windows Live to some of the things we’re doing with Zune. It’s very sort of interesting and at the same time a good collective challenge for us to figure out how to take all of these different things, all of the content, and make it bridge really well.

So, we talked about software is creating the bridge, and we showed some bridging across devices and across content. One of the other interesting conversations going on in the industry and at the show is around the cloud. And I’m going to stick on the back end of the cloud all of the things we just saw, they’re the services. They’re what end users see and take advantage of.

What fuels all of that and what drives all of that? On the back-end sort of cloud computing I’ll give an attempt at a definition. Lots of people have definitions. But just in time provisioning and scaling of software, services or applications or shared resources. It’s a giant pool of resources for taking whether it’s content or applications or services and managing those and taking advantage of it. And why? Because you can accelerate the speed of deployment for applications and services, and lower the cost of acquisition to management to end users and IT.

At the end of the day, it’s how do you take what’s traditionally been a server and turn it into servers, and then turn it into a resource pool that can be used for accessing the content or the services for both corporations and consumers.

Now, one of the questions we get a lot when we come to Taipei is, how do we build a back-end, what should we build in terms of containers, right? One of the big initiatives is in terms of containers or software. And container is a funny term because it sort of describes a physical entity. It’s really how do we take capability and make it available.

From the Microsoft perspective we actually run four of the largest datacenters in the world, from 30,000 square feet facilities to 60,000 square feet facilities, from 30 megawatts going up to 60 megawatts, right? And we started in 2005 with a collocation facility, and in 2010 we’re moving on to our fourth generation, very modular facility.

We look at three things. We look at growing smartly, where do you put datacenters, how do you grow them very efficiently so that you’re being as efficient as possible, measuring that efficiency and using it over and over again, and then ensuring that you’re doing it in a way there’s trust. There’s a lot that goes on, and when you’re sharing your personal content, when you’re sharing business applications and services, the cloud becomes very important, but, boy, it becomes very critical as well. And our collective ability to build things that are secure and scalable and efficient is sort of critical to the future.

Because we’re running a little tight on time, I’m just going to come to the end on this. When it comes to sort of the cloud computing or the back-end for the cloud, there’s a couple things to think about.

First off, we have a Dynamic Datacenter Toolkit. We have the software today. We have Windows Server, we have SQL Server, we have virtualization for that environment, we have management, right, we have identity. So, you have all of the capabilities.

Traditionally you’d buy a server for each one of those. You’d buy a physical box for SQL, you’d buy a physical box for Windows or whichever vendor you were purchasing from.

As we move towards virtualization, if you look at the hardware market today, physical servers are growing about 6.5 percent a year. Virtualized servers are growing about 31 percent a year. So, we’re seeing more and more virtualization.

And when you think about a datacenter, and then ultimately a container you might plug into a datacenter, you’re no longer talking about a physical box for each capability, you’re saying how do I take a set of compute resources, networking resources, apply management, apply essentially water and power and management for all the infrastructure, apply networking, and then balance the load and the capabilities across that entire unit. So, it’s not a physical box for each thing, it’s a physical set of capabilities that then you move around what you want to run on each one of those processors or cores, depending upon how you operate.

And building the infrastructure for that and the management and the fabric, that’s the core of what we do when we build a datacenter.

Turning that capability — and when you think about a datacenter, you could think about Azure in the back-end for running all of Bing or MSN and everything else — how you take that capability and then turn it into an offering that we can work with our partners on, where they can take the software that would run, let’s just say a container for lack of a better term right now, and then turn around and resell it, that’s the next phase.

We have the ability today to allow people to build the environment, right. Putting it all together requires the work we have in IP from our reference architectures. So, we’ve actually built datacenters, we’ve actually designed containers with some of the partners in this room to plug into those datacenters.

So, the combination of the actual software, Windows Server, SQL, et cetera, plus the IP that comes from the reference architectures, creates the baseline for building it. Then you need the operations guideline, how do you build it and how do you run it, and then last but not least, licensing models for no longer selling physical boxes but selling a container or a set of capabilities that go into an entity that you could turn around and resell.

So, that’s the next phase. The first phase, how do you take the servers you have today and build a great datacenter. That’s sort of step one. We do that. Step two is how do we package that up, if we think about working with OEMs and ODMs, to turn it into an offering. And then last but not least, working on opportunities.

The truth of the matter is there’s not a lot of people that are going to create containers and turn around and resell them. But for those that do, there’s very interesting opportunities. Private clouds and customer datacenters, right? As we’re sitting here in Taiwan, there’s lots of interesting conversations going on in China about the private cloud for China, and who will supply the hardware and software that supports those datacenters and cloud computing for China.

There are public cloud interests, there are also private clouds for businesses. There are also hosters who want to use this same type of technology. So, there’s actually a business and an industry for supplying the back-end for cloud computing.

Taking what collectively a few of us do, right, in the industry, which is build very large scale datacenters, modularizing that, taking the IP that’s used to do that, right, and then the software and the licensing and turning it into a partner model, that’s what we do. If you think about Microsoft and the work we do with all of the folks in this room and elsewhere, we’re a company based on partnership. We collectively work with partners to build everything that’s here in everything we do. That’s how our business runs.

When you think about cloud computing, we will do things to learn and invest and support the cloud for our needs, but we’ll also work on building a partner model. And that goes from the software stack to the licensing model to the business opportunities.

Now, I say that, there’s a lot of work to do. There’s a lot of learning we’ve done, but there’s a lot more learning to do.

And so I want to sort of bridge on this particular portion, the cloud is very interesting, right? The cloud takes advantage or provides services that allow us to bridge experiences across all these devices. There’s a similar set of capabilities for businesses — phenomenally powerful.

The cloud really likes smart devices. All the devices you see on stage — we just showed that video across the phone, across the TV and across the PC. It likes all these smart devices. It takes advantage of them, it provides opportunity.

It requires us to collectively be responsible for how we scale this out and how we provide all of the capability, but do it in a secure, safe, environmentally friendly way.

And last but not least, it provides very good opportunity, right, whether you’re building the devices, whether you’re building the services, or whether you’re one of the folks that’s ultimately going to build the containers of the back-end infrastructure.

So, I wanted to do just a little bridge there to make sure people have at least some context for the work we’re doing sort of in our own company and then with partners in the industry around the back-end for the cloud, as much as the front-end.

So, I want to sort of thank everybody, right? We’re working very heavily on innovation that hopefully fuels our collective industry. We work on platform software, we work on experience software. We work on cloud computing. We work on the front-end and the back-end. We look at new business models for all of us. We continue to invest in R&D to help all of us grow. There’s consumer opportunity, commercial opportunity. And last but not least, we work really hard at building bridges, bridges between industries, right, bridges between the hardware industry, the networking industry, the devices industry, and the software industry as we head into a world where convergence drives evolution of all of our industries, and how we do that together.

And we work very hard to build bridges with our partners and create opportunity for everyone, and we very, very much appreciate the partnership with all of you.

So, I’m going to allow this to go, and what I want to say is thank you. And as we head into this, we have a very good display in the back, in the booth area, where you get a chance to see all of the devices that you see here or many of the devices that you see here. It’s located in the Taipei Trade Center. We have the slogan at the bottom, Microsoft innovation equals partner opportunities. All the investments we do are done with the hope and the promise of partnering with all of you, and the folks that aren’t here as well in terms of creating great opportunities and great customer experiences that help our industry grow.

So, with that, I want to say thank you for your time, thank you for your partnership, and we look forward to working with you as we go forward. Thank you. (Applause.)