CES ’09: Microsoft Yawnote

With little in the way of exciting news to announce, Microsoft (MSFT) CEO Steve Ballmer’s keynote address at the Consumer Electronics Show in Las Vegas tonight promised to be a lackluster, if not downright wearisome, affair–even if you’re unnaturally excited by the idea of Windows 7. With the beta version of the operating system widely leaked last week, there simply was not all that much to reveal. Unless, of course, Windows 7 PCs–like Vista PCs before them–ship with XP downgrade rights….

Beyond that, there’s likely to be a fair bit of talk about the Windows Mobile platform, the company’s new–and prematurely announced–agreement to become the default search provider for Verizon Wireless (VZ) and perhaps provide some sort of Zune interface for cellphones, but little else.

The keynote begins a bit before its scheduled start–not with Steve Ballmer, but with two beat-boxers. Wonderful, they’re rapping about CES. Where’s Bill “Big Pimpin'” Gates, when you need him?

The performers leave and Consumer Electronics Association President Gary Shapiro takes the stage. He acknowledges it was a “tough 2008,” and after a few introductory remarks (“Steve received a perfect 800 on the math portion of the SATs!”), introduces Ballmer. But first a little video. As it plays, I notice my inbox filling up with a handful of Microsoft press releases: Microsoft’s Ballmer Announces Availability of Windows 7 Beta and Windows Live, Microsoft makes new, early version of Windows available, etc.

Ballmer takes the stage a few moments later, all high energy and charisma. He begins by recognizing Microsoft’s history at the event and, of course, that Bill Gates has keynoted a CES or two in his time. A brief aside about email messages he’s received about the event today. There’s one from Gates: “Steve make sure you’re at CES and not that other event in Las Vegas this week” (presumably the annual Adult Video News Award show). And one from Yahoo CEO Jerry Yang: “Steve why do you keep ignoring my friend requests on Facebook?” Then, on to an industry overview.

“Today our world, our nation and our industry face some really big challenges,” Ballmer says. “All of us, we’re all feeling it. And its impact will likely be with us for quite awhile. But no matter what happens with the economy or how long this recession lasts, I believe our digital lives will only continue to get richer.”

Companies that pursue innovation will do better than those that pull back, says Ballmer. “We will continue to invest more than others.”

Outlining the broader vision now. Microsoft’s original vision was to put a PC in every home–a single screen. Today, it’s about three screens. The PC, the mobile phone and the TV. And the barriers between these screens are slowly going away. They’re being connected by the cloud. This is the “last mile” for the consumer experience–bringing the TV, the PC and the mobile phone together through the cloud.

And at the center of this experience? Windows, of course.

“In the next couple of years the computer will be able to hear you,” says Ballmer. “Speech gestures and handwriting will become a normal part of the way we interact with our PCs, our phones and our TVs…. Windows has become the language that over a billion people speak around the world.”

Moving on to hardware now. “At this time economically, when people are struggling…the choice that offers the most power and most value for the money is the PC.”

Oh, we all know what’s coming now, don’t we?

Yep. “That’s why I’m a PC and I’m proud of it!”

Onward. “Microsoft is transforming Windows from a PC operating system to the cloud,” says Ballmer, who notes that he’s excited by the progress the company’s made with Windows 7. “It’s the best Windows ever,” he says. Faster boot times, touch support, etc. “We are on track to deliver the best version of Windows ever. We are putting in all the right ingredients…and working hard to get it right and to get it ready…. Windows 7 will make every day tasks faster and easier.” And then, as expected, Ballmer announces the official beta. Smattering of applause. No big surprise here. “I encourage you all to get out and download it,” Ballmer adds.

Moving on to Windows Live now. A handful of announcements. Windows Live Messenger, Windows Live Photo Gallery, and Windows Live Mail. A partnership with Facebook. And a distribution deal with Dell (DELL) and the Verizon Wireless search deal, which was unofficially announced earlier today.

Ballmer invites product manager Charlotte Johnson to the stage for a demo of Windows 7, etc. Apparently very easy to clear desktop clutter in the new OS. Easy to compare two documents or Web sites as well. If that’s Windows 7’s marquee feature, Microsoft is in big trouble. This is all stuff that was in the pre-beta. “Homegroup” feature seems a nice way to set up a home network. Course, all the PCs involved must be Windows 7 machines for it to work.

On to multi-touch. “We built touch into the DNA of Windows 7,” Johnson says. She uses a touchscreen to navigate a 3D map of Manhattan. Yawn. Very little new here. The same is true of the Windows Mobile demo. Big revelation: Internet Explorer 6 for mobile phones supports Flash. And the Windows Live home page can now display updates from Facebook, Twitter, etc…. No. Nothing much new here at all. Seems today’s big announcement is the official beta of Windows 7.

Oh, here’s something. A new feature in Messenger. Some sort of dynamic display picture to communicate user moods. Exciting. A bit more patter and we’re on to the obligatory “I’m a PC” ads.

And then…another band? An Australian musical comedy act called Tripod. WACKY. No Flight of the Conchords, though.

Tripod finishes up and Robbie Bach, president of Microsoft’s Entertainment & Devices Division, takes the stage. “Zune had a great year. We’ve won critics over,” he says–and without a trace of irony. Two million people on Zune social, apparently.

Moving on to Xbox. “Not only our best holiday season but our best year ever for Xbox sales.” Two new Halo games in the pipe–“Halo Wars” and “Halo 3 ODST.”

Then a few moments on Xbox Live Primetime and we’re on to Kodu, a tool that enables users to create games without knowing a traditional programming language. Bach invites a 12-year-old girl onstage to demo it. She shows off a game she created and then beats Bach at it.

Ballmer returns to the stage for some Microsoft Research demos. First, some sort of digital anatomy textbook. Five bucks and a copy of Bill Gates’s “The Road Ahead” says we’ll get another Surface demo next.

And indeed we do. That’s followed by flexible color display less than one millimeter thick. And that’s pretty much it. A few final remarks from Ballmer and Shapiro and then Tripod closes out the keynote.