After what he considered weeks of unfair press coverage and running down of Microsoft (MSFT), the software giant’s Corporate VP of Corporate Communications, Frank Shaw, posted a pugnacious corporate blog entry today that trotted out some impressive numbers about Microsoft’s business.

Of course, he also took the opportunity to put up some not-so-much figures about competitors such as Apple (AAPL), Netflix (NFLX), Salesforce.com (CRM) and, of course, Google (GOOG).

My favorite dig is the stat on the “percent chance that Salesforce.com CEO [Marc Benioff] will mention Microsoft in a speech, panel, interview, or blog post.” The answer, natch: 100!

As it turns out, that was a follow-up to a very sharply worded letter Shaw sent out to communications teams across Microsoft (MSFT) earlier this month, obtained by BoomTown, in which he noted at the start:

“It has been a rough couple of weeks for us from a coverage standpoint. It seems like every time I turn on the computer, or talk to a reporter, or pick up a publication at home, or do a scan of my RSS feeds or Twitter client that I see more stories and opinions about the challenges we have, and how great some of our competitors are doing. iPad this, Droid that, sheesh.”

Sheesh? Who says that anymore?

Still, I like his gumption in using it! Thus, Shaw–who is an active blogger and Twitter poster–is apparently mad as heck and not going to take it anymore!

Here’s the blog post below, followed by the internal email Shaw sent (apparently inspired by the landscape at our eighth D: All Things Digital conference earlier this month):

Microsoft by the numbers

25 Jun 2010 12:30 PM

You probably saw the news this week that we’ve sold 150 million Windows 7 licenses in 8 months. That’s more than 600,000 per day. And, perhaps fittingly for a product called Windows 7, it adds up to 7 copies every second of every day since launch.

As a communications guy, I’m generally most comfortable with words. But since Microsoft is a pretty numbers-driven company, the Windows 7 milestone got me thinking about some *other* numbers, too.

Of course, numbers are only one dimension of a story. And we live in a hyper-competitive industry, with loads of challenges to go along with loads of opportunity. All the same, with Windows 7, Office 2010, Bing, Xbox 360, Kinect, Windows Phone 7, our cloud platform, and many other products, services and happy customers, 2010 is shaping up as a huge year for us.

So, without further ado, a few of my favorite numbers:

1

150,000,000
Number of Windows 7 licenses sold, making Windows 7 by far the fastest growing operating system in history.[source]

2

7.1 million
Projected iPad sales for 2010. [source]

58 million
Projected netbook sales in 2010. [source]

355 million
Projected PC sales in 2010. [source]

3

>10
Percentage of US netbooks running Windows in 2008. [source]

96
Percentage of US netbooks running Windows in 2009. [source]

4

0
Number of paying customers running on Windows Azure in November 2009.

10,000
Number of paying customers running on Windows Azure in June 2010. [source]

700,000
Number of students, teachers and staff using Microsoft’s cloud productivity tools in Kentucky public schools, the largest cloud deployment in the US. [source]

5

16 million
Total subscribers to largest 25 US daily newspapers. [source]

14 Million
Total number of Netflix subscribers. [source]

23 million
Total number of Xbox Live subscribers. [source]

6

9,000,000
Number of customer downloads of the Office 2010 beta prior to launch, the largest Microsoft beta program in history. [source]

7

21.4 million
Number of new Bing search users in one year. [Comscore report--requires subscription]

8

24%
Linux Server market share in 2005. [source]

33%
Predicted Linux Server market share for 2007 (made in 2005). [source]

21.2%
Actual Linux Server market share, Q4 2009. [source]

9

8.8 million
Global iPhone sales in Q1 2010. [source]

21.5 million
Nokia smartphone sales in Q1 2010. [source]

55 million
Total smartphone sales globally in Q1 2010. [source]

439 million
Projected global smartphone sales in 2014. [source]

10

9
Number of years it took Salesforce.com to reach 1 million paid user milestone. [source]

6
Number of years it took Microsoft Dynamics to reach 1 million paid user milestone. [source]

100%
Percent chance that Salesforce.com CEO will mention Microsoft in a speech, panel, interview, or blog post.

11

173 million
Global Gmail users. [source]

284 million
Global Yahoo! Mail users.[source]

360 million
Global Windows Live Mail users.[source]

299 million
Active Windows Live Messenger Accounts worldwide. [Comscore MyMetrix, WW, March 2010--requires subscription]

1
Rank of Windows Live Messenger globally compared to all other instant messaging services. [Comscore MyMetrix, WW, March 2010 - requires subscription]

12

$5.7 Billion
Apple Net income for fiscal year ending Sep 2009. [source]

$6.5 Billion
Google Net income for fiscal year ending Dec 2009. [source]

$14.5 Billion
Microsoft Net Income for fiscal year ending June 2009. [source]

$23.0 billion
Total Microsoft revenue, FY2000. [source]

$58.4 billion
Total Microsoft revenue, FY2009. [source]

fxs

It has been a rough couple of weeks for us from a coverage standpoint. It seems like every time I turn on the computer, or talk to a reporter, or pick up a publication at home, or do a scan of my RSS feeds or Twitter client that I see more stories and opinions about the challenges we have, and how great some of our competitors are doing. iPad this, Droid that, sheesh. Even BusinessWeek got into the act, taking some unfair shots at Natal under the guise of looking at our consumer strategy all up. Man, when someone is beating on Natal prior to E3, you can bet we’ve got momentum against us.

Sitting there at the All Things Digital conference last week and hearing from our competitors really got me thinking, though. What is our differentiation? Why do we make certain decisions? What drives the way we think about business and technology? The morning after the Steve Jobs q&a (which everyone should watch), I dragged myself out of bed to go for a run. As I’d driven into the hotel, I noticed with a sinking feeling that there were lots of hills. I asked the desk clerk if they had a jogging map. They did not. I asked if he could point me a direction that did not have a bunch of hills. He laughed and pointed “up” the driveway and said that if I turned left there would be a nice running path. “I drove in that direction,” I said. “Seems like it’s uphill.” He shrugged, and away I went. Up.

And to keep my mind off the elevation gain, I was thinking about that previous question–what drives Microsoft? Coming up the second hill, I got it. Fundamentally, we believe that we have the opportunity to make life better for billions of people around the world through our products and services. Not millions, not tens of millions, but billions. We started with the idea of a computer on every desktop, and even though the computer looks a lot different today than it did those years, and even though the developed world probably does have a computer on every desk, there are still billions more to go, and we are going to get there. And when you start thinking about serving billions, which we do, we’re playing a game that nobody else in the industry is. I don’t know about you, but I come to work thinking about what I can do to help w/ that big goal. And it’s not all altruism and unicorns, when we do a great job of creating products that make life better for billions, it makes us better as a company, we sell more, we learn more, our partners do better, we do better. And when you have big dreams and big ambitions (like we do) and when you set the bar high (which we do) then sometimes we don’t get over the bar. There are people in the world that see that and call it failure; but failing to hit the mark doesn’t mean quitting. That’s part of our culture, too.

The run back to the hotel was easier. I even scrambled up a bluff next to the path (imagining the theme to “Rocky” in my head) and stood looking out over the Pacific for a bit. And I thought about our challenges, internal and external. External is easy. Internal is harder.

There is a saying I’ve heard a bunch since I’ve been at Microsoft: “Hope is not a strategy.” Heck, I’ve used it myself, and felt pretty superior while saying it, since I was talking about something I didn’t really own. But standing on the bluff, I wondered.

In my last mail, I referenced the need for us all to be comfortable in the gap between what is and what we desire to create. If we simply live in what we have, we become cynics. And if hope is not a strategy, then neither is cynicism, and we have lots of cynics among us. It is a challenge, especially for those of us who help tell our story. I often see it used, and use it myself, to cover up the pain of not meeting a goal, or seeing a product/service be ill-received by the market. If I am able to mock and sneer, then nobody outside the company can make me feel worse at setbacks and even failures.

As the evangelists for the company, we must guard against this. Hope can’t be a strategy, but it (and its cousin belief) is a needed ingredient in any success. Think about this for a bit. Each and every one of us needs to be grounded in our challenges and our wins. Right now, we are massively over-indexed in thinking and knowing about our losses and challenges. But what of our wins?

At the conference later that day, I had a chance to engage in a spirited and mostly friendly discussion with some folks who thought we were doing a crap job all up. Stock price flat, no iPad, etc. Instead of shrugging and agreeing, I talked about our wins and our momentum. We’ve built a huge server business over the last decade, something else nobody has done. Windows 7 sales are up about 39 percent year over year, against a huge base. Office 2010 beta largest ever, Office is in the cloud. Bing is one year old, 4 points of market share–nobody has grown search market share against Google but we are doing it. They are copying our look, our home page. New Hotmail is driving them to offer something other than threaded email for Gmail. Xbox Live has 23 million users–again, only two companies in the last decade have built subscription services like this (Netflix is the other). Windows Azure has 10,000 paying customers, we just announced 700k deployment of live@edu, probably the largest cloud deployment in the world. Natal is coming, it’s cool. Yes, we want to (and will) do better in phones. Yes, we want to (and will) have more cool thin slate/tablet/other form factor devices that run Windows. I’ll tell you, while I don’t think I created any true believers, I did force people to think differently about Microsoft and what we’re doing, and I call that a win.

This is our job. We don’t just represent the products and services we work on, we represent the company all up. Be ready to tell that story. Tell it to your co-workers here at Microsoft, to your family and friends, to members of the media. They know about our challenges, they don’t know about our wins and momentum. So tell them.

fxs

Steve Ballmer is delivering his annual state-of-Microsoft address at the Consumer Electronics Show in Las Vegas tonight–his second since assuming the duties of former CEO Bill Gates.

If anything like last year’s, Ballmer’s address will offer a broad overview of Microsoft’s (MSFT) consumer strategy for the year, touching on everything from the company’s hardware-software ecosystem to its home entertainment offerings.

Likely to figure prominently in tonight’s address: Windows 7 and the new touch-enabled PC form factors it has evidently inspired; Bing; and Natal, Microsoft’s controller-less game control system, which will launch in time for the 2010 holidays.

• The keynote begins with, what else, some introductory remarks from Consumer Electronics Association President Gary Shapiro: “Happy New Year and welcome to 2010 CES, the World Cup of innovation. The past year has been a challenge. The global recession has affected all companies. Fortunately, signs are pointing upward, and I believe CES will be remembered as a turning point.”

  Let’s hope so.

• Shapiro welcomes Steve Ballmer to the stage, and the Microsoft chief begins by noting that 2009, in case you hadn’t noticed, was a year of profound economic turbulence. But innovation persisted. And with that, he rolls a first video designed to demonstrate his point. It features “one random guy’s” experiences with technology this past year, namely Seth Meyers of “Saturday Night Live.” Seth talks to his grandmother on a Web cam. He plays videogames with a kid and loses. “Before texting existed, I never sent the wrong person a letter telling them they’re a jackass. Thanks, technology….Before Twitter, if I knew what someone’s cat was thinking, I would have had to be an idiot.”

• Ballmer: “We’re going to focus on three things tonight. The [first is the] increasing importance of the small screen, the ever-evolving PC and the future of TV. The second is the cloud. Third is natural user interface–NUI technology. The last few decades have been absolutely stunning in the changes they’ve brought.”

• And here’s the sound byte of the evening: “We Bing. And we Bing. And we Bing Bing Bing. At least in my world.” Ballmer says 2009 is a year in which the company has made incredible progress with Bing. “We added 11 million new users….We redefined what search should do for users–we work to understand user intent and anticipate what users are really looking for. We know we’re at the beginning of a long journey, but we think we’re off to a good start.”

  There’s some news about Bing today, a distribution deal that makes it the default search engine on HP PCs in 32 countries.

• Also figuring prominently in 2009: Xbox. Microsoft first launched it at CES in 2001. Today, there are over 39 million Xbox 360s around the world. And more than 500 million games. The console has generated $20 billion in total game revenue.

• Ballmer is moving on to the mobile space now. Windows Phone–technically Windows Mobile 6.5, a necessary stopgap on the path to 7.0–which debuted last fall in a nimbus of disappointment. Ballmer notes that Microsoft is announcing a new Windows Phone partnership today with T-Mobile, which is bringing HTC’s HD2 phone to the U.S. He says little about Windows Mobile 7, Microsoft’s “modern” mobile operating system, which at last check was scheduled to arrive at market sometime in late 2010.

• Ballmer is talking up Windows 7 now. PC sales jumped 50 percent the week the OS debuted, he says. And according to research outfit NPD, sales of Windows PCs grew 50 percent over the 2009 holidays and retailers sold 63 percent more PCs than they did this time last year. Gartner (IT) now sees three percent PC unit growth in 2009–nearly 300 million PCs shipped in 2009. For 2010, Gartner sees a jump of more than 12 percent.

  “Windows 7 is by far the fastest-selling OS in history,” says Ballmer. “Clearly, consumers are saying there’s never been a better time to be a Windows 7 PC….Windows 7 is a rising tide that’s lifting all boats in the PC business.”

• Ballmer calls Ryan Asdourian, senior product manager for Windows, to the stage. “We’re going to see some of Ryan’s favorite hardware and software,” he says. Among them the Sony (SNE) Vaio L–an all-in-one built for high-definition entertainment–and the Asus NX90, a slick-looking laptop designed with help from legendary audio firm Bang & Olufsen.

  “Being in Vegas, you’ve got to look sexy,” says Asdourian. Ballmer: “Good thing we brought some PCs.”

• Next, some software demos–Ray Kurzweil’s Blio Ereader App?, then a new Skydrive collaboration in Windows Live. Ballmer: “Developers baby! Developers! I love the people who’ve built this stuff.”

• Ballmer moves on to Windows Media Center and Mediaroom 2.0, which will now deliver live and on-demand TV through set-top boxes, PCs, and Windows Mobile devices like the HD2. It is coming to AT&T’s (T) U-verse. Streaming video on the HD2 looks pretty slick.

• “The world of entertainment and content will come in different forms and flavors. But no matter what the source, Windows PCs will offer the greatest entertainment experiences in the world,” says Ballmer. And with that, he shows offs some new slate PCs. Sadly, the Courier–the dual-screen multitouch device that many had been hoping to see–is not among them, as BoomTown reported earlier today. There are, however, some cool-looking offerings from Hewlett-Packard (HPQ) and Archos.

• Ballmer rolls another Seth Myers video, “Milestones in Technology.” Not funny. Yeah, I don’t really miss “Saturday Night Live” at all anymore.

• Robbie Bach, president of Microsoft’s Entertainment & Devices division, takes the stage. “Computer science is the only science bounded solely by our imaginations,” he says, referring to Xbox. “2010 is going to be a landmark year for Xbox customers. We’ll be offering the best line of Xbox 360 games.” Examples: Mass Effect 2 and Splinter Cell Conviction. Also an episodic “psychological action thriller” called Alan Wake. “Imagine ‘Lost’ written by Stephen King, filmed by David Lynch,” implores Bach.

• Bach: “What ‘Star Wars’ is to film, what Harry Potter is to fantasy books, Halo is to videogames.” And with that, he rolls some video of Halo Reach that I can’t see because I’m watching the event remotely. The game is coming in the fall of 2010, but will be available as a multiplayer beta on Xbox Live this spring.

• Bach announces Game Room for Xbox Live! More precisely, a vintage gaming service that offers 30 classics from Atari, Intellivision, etc. The company plans to add over 1,000 games to Game Room over the next three years.

• And here comes the pitch for Project Natal: “We’re at an exciting inflection point in tech, where we can create an experience that is more intuitive. With Natal we’re freeing you from the last barrier, the game controller.” Bach rolls a video of the folks behind the Xbox’s new natural user interface, or NUI, which is due out later this year. “Project Natal will be available this holiday 2010….It will work with your existing Xbox 360.”

• “When I said 2010 was going to be a big year for Xbox 360, I was lying: 2010 is going to be the biggest year in Xbox history!”

• Bach wraps things up with some big-picture remarks and–well, I guess that’s it. He leaves the stage and the house lights come back up.

Consumers.

Two weeks after Sony lowered the price of the PlayStation 3 to $299 from $399, Microsoft did the same for the Xbox 360 Elite by slashing $100 off the price of the console. In addition, Microsoft cut the price of its now discontinued Xbox 360 Pro console by $50 to $249.99, while supplies last. Both price cuts go into effect tomorrow.

“This is really an effort to pass the cost reduction we are able to achieve through engineering and manufacturing onto consumers,” David Dennis, Microsoft Xbox 360 product manager, told USA Today. “Reducing the number of (models) really just simplifies our manufacturing and makes it easier for our retail partners to manage their inventory and makes the purchase decision easier for consumers. It’s really a win-win-win all around.”

Like Sony (SNE), Microsoft (MSFT) believes the move will lure a new segment of price-conscious consumers into the market and goose sales heading into the crucial holiday shopping season, though it may not prove as effective as the company hopes. To really drive sales, says Jesse Divnich, director of analyst services at Electronic Entertainment Design and Research, Microsoft needs to drop its prices even further.

“Some would argue that Microsoft’s new pricing scheme represents more of a pseudo price drop than an actual price drop since consumers looking to purchase a core Xbox 360 system will still have to pay $299, as they had prior to the new hardware line-up,” Divnich explained in a recent research note to clients. “The price drop on the Xbox 360 Elite means that Microsoft’s core hardware SKU now boasts a bigger hard-drive and HDMI support than its Xbox 360 Pro predecessor.”

Moreover, while the 360 and PlayStation 3 might share the same $299 price point, they don’t share the same specs. “…Technologically the Xbox 360 is not at the same level as [the PS3],” Divnich said. “This puts the Xbox 360 into a tough position where it is outmatched in terms of hardware capabilities at $299 and the Nintendo Wii remains alluring to casual and price sensitive consumers at $249.”

Looking ahead, Divnich predicts that “Over the next year Microsoft will most likely reposition the Xbox 360 Elite model closer to the $249 price point to both pressure Sony and attract potential Nintendo Wii consumers. From a strategic standpoint this would then allow Microsoft to introduce the new Natal model in 2010/2011 at the $299 price point and still have an option for consumers cheaper than the (PS3).”

I’d hate to be Nintendo right now. What can it possible demonstrate at E3 tomorrow that will surpass or even match the gesture control gaming technology Microsoft (MSFT) showed off on Monday (see video below)?

Project Natal, as Redmond has codenamed it, is a controllerless game control system. It uses a 3-D camera and an array of motion sensors to capture player movements and translate them into in-game actions and, judging from this morning’s demo, it works quite well. Microsoft says Natal will support voice and facial recognition and multiple players by the time it launches. Just when that will be is anyone’s guess; it’s unlikely to be in 2009.

Lucky for Nintendo, because this is going to make the company’s WiiMote look like a clumsy old Atari joystick.

“The next step in interactive entertainment is to make the controller disappear,”said Steven Spielberg, who was on hand today to promote Microsoft’s new technology. “With ‘Project Natal,’ we’ll see games that bring everyone together through technology that actually recognizes us…this is not about reinventing the wheel–it’s about no wheel at all.”

It’s also about innovation–something we’ve seen an unusual amount of today from Microsoft first with Bing and now this. Could it be we’re witnessing the reinvention of Microsoft itself here as well?