Intro music. Female voice, “The Guardian.” More music and noises.
Male Narrator (MN): Hello and welcome to Tech Weekly from The Guardian where, as you can probably hear, we’re coming to you from fabulous lost wages. There’s gambling and debauchery aplenty but we’re in town for some serious business, to keep tabs on the Consumer Electronics show as the world’s most influential technology showcase rolls into town. Everyday this week, we’ll be talking to movers and shakers on the show floor as well as talking to guest pundits to discuss the latest news and gadgets coming at the event. In today’s show, we’ll be hearing from Microsoft about their plans for the future. We’ll be talking to the crowds about their favorite gizmos and having a look around the floor as the event opens its doors. So let’s hope the odds are good and the stakes are high because this is Tech Weekly at CES from The Guardian.
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MN: One of the biggest companies at CES in 2010 is and has been for the last decade is Microsoft. In recent years, the companies head honchos have opened the event with a keynote speech where they outline their vision of the future. Earlier I caught up with Microsoft’s Darren Houston, who heads up the companies consumer and online division, to find out more. I started out by asking him how important CES was to Microsoft and to the wider technology industry.
Darren Houston (DH): CES is really I, I consider really the premier consumer electronics show in the world. It’s also interesting because it’s a the beginning of a calendar year, so it’s often a time to reflect on the things that happened in the last calendar year and then look forward to the innovations and things you see in terms of what’s happening in the next calendar year.
MN: So could you run over a few of those things? What is the big vision that Microsoft has for 2010?
DH: We have three strategies in the consumer space. One is multi screens so moving off of just being a PC player and moving across multiple digital screens. The second strategy we call, “software plus services,” so not just working on software that is resident on a client or the device but also working software that is on line and leveraging the Internet to connect the pieces and a third important part of our online strategy is called “natural user interface.” This has been work that has been going on at Microsoft for years, some of it is on our competitors [2] like the Nintendo Wii or the iPhone but also it’s a lot of things we’re doing with things like multi-touch for Windows 7 or Natal, which is a project we have been working on just to use human movement to play games and things like that.
MN: Last year Windows 7 was the big announcement, you know showing off some of, some of the things … it, it’s … does. Windows 7 is now launched
DH: yeah
MN: and so the focus is more on the kind of next generation of stuff and you were mentioning mobile. Microsoft has been along in mobile for a long time but its market share’s diminished especially in the last couple of years as you know everybody, all of these new players have rushed in. Umh, what kind of trends are you seeing that Microsoft can harness to leapfrog or to fight back against the competition?
DH: We’re a partnering company. Our bet always is that ultimately as an industry grows and democratizes it is much better to have, you know, better value for the consumers, significantly more choice and the ability for the consumer say to say, I want a Sony TV but I want a Toshiba laptop and I want a Nikon camera and I want a Samsung phone. So we’re, our play very much in the mobile space is a horizontal market play and that is a big bet. It is a big bet around wanting to democratize the smart phone, bring it to more people and more places and I think in the longer term that, that bet will, that bet will play up, that we believe that we can bring technology to a broader set of manufactures and ultimately, that will mean more choice and lower cost for consumers. It’s kind of like all the talk about tablet now and we’ve been in the tablet business for years and if all the buzz helps really bring tablets into the mainstream then our ecosystem will help democratize that and give people more choice.
MN: Is that a strength or a weakness for Microsoft? You know, now you can’t escape the buzz about things that Microsoft would sit back and say, “We’ve been doing those for years.” Tablet is a brilliant example. Is that a weakness of the partnering strategy, that you sometimes you just need to get perfect examples into people’s hands straight away or else the momentum fades away?
DH: There are weaknesses to the partnering approach. If you can’t, if your partners and you can’t get it together and somebody else just because you are uncoordinated, you are suspicious of one another, you can’t create win-win opportunities and a vertical player comes and does it and end to end that, that is a weakness but I’m glad to be on this side of things because I think that ultimately choice and value wins out in the minds of consumers. You know, I think of the IT industry as a jungle, umm, there’s obviously lots going on inside the jungle but really the most important thing is the health of the overall jungle and is it delivering value to the end user. That’s what really says if Microsoft, Apple, Google others are going to be successful and at this very point in time I think the jungle is quite healthy.
MN: To expand your jungle analogy, I just wondered, I, it, it feels like all the big beasts in the jungle are trying to eat the same stuff. If you look at Microsoft, Apple, Google, all now are operating in a lot of very similar areas. Is there space for everybody to play nice?
DH: Obviously a bigger pie helps makes everyone’s slice’s bigger but obviously there is competition in everything we do. I mean if you look five years from now, this is a great, I mean, what is a phone, what is a PC in five year, what is a television is it a display or is it like a PC with with a big display? So there is a certain amount of convergence going on in the consumer space, people look over in other spaces and go, “Wow, I used to think that something out of something I did but now it seems very core to what I do.” People are feeling, and even Apple making this recent acquisition in the advertising space. You kind of scratch your head and go, “What’s going on there?” What is really, is it’s the dynamic of digitization of life and everything s becoming digital and when everything becomes ones and zeros it becomes interesting.
MN: So I want to pick up on a couple of specific things. You know, I live in the US now and I see more people using Bing and the market share is going up. Outside the US, ahem, Google is often in an even stronger position than it is in it’s home market. I mean in the UK,
DH: yeah
MN: Google is, is more dominant. How well is the attempt to grow Bing going outside the US?
DH: Yeah, yes. It’s actually, I mean, even outside the US we’re inching away at your statement at Google being very dominant, particularly in Europe it’s true. Actually, if you go to north Asia, it’s completely different, I mean, I think Google is mostly withdrawn from Korea, alright, because they are just too small or in China there a small player or in Japan or Russia they are small players but I think your point is right if we face different competitive dynamics in many of these different markets, generally Google though is the biggest player in almost any market and ah we’ve just gotta assume and hope that people want a choice. Now with Bing we’ve just started the investment on differentiation. As we continue to invest to make our search results better then you get more in to a situation of Coke Pepsi, Burger King McDonald’s that I think actually helps the small player because people do want alternatives in life but this is a long term thing.
MN: A while ago when we heard that Microsoft was thinking about bringing search adverts or advertising, which is the you know money making part of search, maybe into the desktop as well and kind of meld those two worlds. Can you just explain the thinking behind that because a lot of people were like, “My God! I don’t want adverts on my desktop!” and how is this going to happen? [laughs]
DH: We have tried some experience with ad funded Windows in places like Brazil and China, you know, where people maybe are not paying for Windows in any respects, we actually found that some people appreciated certain forms of ad funded windows more than they did the other form of Windows which was interesting because the brands brought some value but that’s just interesting, it’s not something we are pursuing right now but the other thing we’ve been doing is these Windows 7, we have these theme packs, so instead of going online and downloading a pretty picture of a field or a mountain or something we have new geo theme packs which are countries which are interesting. We also have brand theme packs. We have Ferrari Ducatti, Coke-a-Cola, and and actually people think we’ve charged for it but we haven’t it’s a pilot but we’ve found out that six of the top ten most used desktops since the launch of Windows 7 are actually brands and for instance the Avatar one last week was by far the number one. We did more than a million downloads of the Avatar desktop. For the advertiser, let’s say, for Ferrari to know that you are an avid Ferrari fan is a big deal for them [garbled]. So we’re playing around on the edges. We certainly wouldn’t do anything at this point that wouldn’t be opt in by the consumer but we are experimenting with a few thing that are having some early interesting success.
MN: You were talking about products and certainly Xbox as being very successful. In terms of other hardware that Microsoft’s tried to take on, like the Zune, a nice piece of hardware but does not seem to have caught the public imagination. Do we expect to see Microsoft at a point in the future going into hardware more because Xbox worked or are you going to stay away from it because Zune didn’t?
DH: We’re a software company so our passion, what our people work on, is they just want to bring great software to market and the times we’ve gotten into the hardware market there almost because we could not get the ecosystem to respond and even in the music player business we tried to get an ecosystem going but it never got to a big enough size so we tried to be a little more vertical but I think at our very core we are a software company and even the beauty of Xbox is really the software and how it then connects online and Xbox live is just like so powerful but it happens to come in a box that we have someone else has manufacture we don’t have factories manufacturing Xbox, it’s somebody else manufacturing it, we would rather have an open ecosystem in that area. So, so I think we will get into that business when we need to bring our software to life but it is always with the primary goal of being a software company but every industry is at a different nascent state, just like the smart phone market, it’s still early actually, it’s a very early chapter and our bet in the cell phone market is horizontal and that consumers want choice and that consumers are going to want value as this industry grows and right now in the early days the vertical players are showing more progress but I think ultimately a horizontal play in a big industry like that is the right way to go and that’s what we’ve done in the PC and what we hope to do in the phone business.
MN: That was Microsoft’s Darren Houston there talking about the future of the company. Now, as you can probably tell, we’ve moved out of our little room that we were in before and ….
talks to people from Reddit and Pocket Lint a CES virgin, laughs all around ha ha. Blather about Ballmer Natal and Slate PC promises. Me too moves, Natal is Wii, Slate is another tablet PC. … Sony person says Microsoft stuff does not make him exciting, uses XP, no one in their right mind would use Vista … very little that makes you go “aha, they’re on to something there.” Apple casts this pall over everything else … Not excited about Apple tablet PC, Apple keeps killing it. Is there a use case for Slate? Digital magazine, home control, media gateway to your Apple, docking station in your coffee table, no one wants to do that. iSlate? Why does my mom want an iSlate? Apple markets it for two years, so everyone knows what it does, the magic of Apple. … Pass the bathroom test. I can bring in my Kindle Apple Air and it’s not comfortable or hygienic while I’m taking care of things. Dude, that’s what my Blackberry is for… Highlights and Lowlights Panasonic 3D, $21,000 camera that looks like Wale, filmed in 3D, where things are going. We are in 3D right now, Amazing. Weird meta rubbish. What’s bad about Sony? I’ll save you the trouble, Alexis. Panasonic big TV, 12 foot TV, he wants a 200 inch TV. … Quadrocopter, fun for the kids, executive boys toy, I don’t’ know how much it costs, you can control with your iPhone. It was not able to work, to many wifi’s, non existence demo.
Talks to crowd. I want to see 3D TV. Was there last year and year before, wants to skype from TV. Samsung can make 2D to 3D. Multi media PC people likes tablet and touch
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Digital experience up the strip surprises MN. Something about water on a laptop, look it still works! I want my power, take a laptop in the rain up a pole! You can’t take it underwater and that’s useless anyway. Use it on the back on the police car in the rain while on a man hunt. Sulf fog, salt water corrosion. Computer works for 3 day in marine environment. snore… Juice care batteries for iPhone. A credit card add on for the iPhone, so people can take money. Run the app, type in the amount, slide the card. Authorized in real time and deposited in your bank at the end of the month! Motorola Android person talks about backflip, keyboard opens up. Motorola aggregates email, IM and other stuff. Backtrack, a touchpad on the back of the phone.
More music and that’s it. They will be back tomorrow. Got the website to see the video. MN asks you to laugh at him, thanks guests and listeners.
Female voice tells you to go to guardian audio website. Musical finale.
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