by Shane O'Neill

That’s What He Said: Ballmer on the State of Microsoft

Jul 12, 20116 mins
Cloud ComputingCRM SystemsDeveloper

Steve Ballmer's WPC 2011 keynote turned into a lengthy state of the state of Microsoft, as he expounded on products like Skype, Windows Azure and Bing and how they will affect enterprises, partners and competitors. Here are some of Big Steve's most quotable fightin' words.

Microsoft CEO Steve Ballmer took to the stage for his keynote at Microsoft’s 2011 Worldwide Partner Conference with his usual fist-pumping exuberance.

After thanking Microsoft partners profusely for their hard work and revenue generation (Microsoft does 95 percent of its business through partners), Ballmer stressed the importance of the cloud computing, and urged partners to go “All In” just like Microsoft.

“We need partners who want to come with us to the cloud. We need you to decide, and  to see 15,000 people here coming with us to Windows Azure and Office 365 is exciting after being nervous last year when some of you said you were not ready to be all in,” Ballmer said.

“Yes, it’s disruptive technologically — we’re redoing our business model and you will have to retrain and reskill yourselves for this new world. But I’m glad you’re making the journey with us.”

Slideshow: Teardown: Microsoft CEO Steve Ballmer

Another part of Microsoft’s journey is giving  partners and anyone else watching (that means you Wall Street investors and Microsoft’s many competitors) a detailed update on how Microsoft is doing. And with that, Ballmer laid out an extensive state of the state on all of Microsoft’s services and products. How does Ballmer think Microsoft is doing? Awesome of course! Although there was a shred of humility for struggling products like Windows Phone 7.

Here are Ballmer’s WPC keynote fightin’ words on everything from Bing to Windows Server.

Office 2010 and Office 365

“Office 2010 is our highest selling version of Office — a year after its release and it has already sold 100 million licenses … Two weeks ago we announced Office 365, where office meets the cloud. Leading up to the launch, we had one business every 25 seconds trialing Office 365.”

Regarding Office 365 competition:

“Basically the other guys have yet to really show up [an unsubtle reference to Google] … Any place we engage with Office 365 we win.”

Note: Tell that to the U.S. GSA (General Services Administration), which chose Google Apps over Microsoft’s cloud service, after a six-month bidding process, to migrate all its employees in 17 locations around the world to the cloud for email and collaboration tools.

Skype and Lync

“I’m very enthusiastic about acquiring Skype. It is very consistent with one of Microsoft’s core businesses, which is to help people communicate and collaborate. Some partners have asked: Does having Skype mean you’re not serious about Lync? Quite to the contrary. One of the great motivations in acquiring Skype is to enable the enterprise to have all the control it wants in communication and collaboration through Active Directory and Lync, and yet be able to connect people within enterprises to consumers, businesses and partners around the world. Lync, in some sense with Skype is a strategy that will allow the consumerization of IT to really proceed with full vim and vigor.”

“Seventy percent of the Fortune 500 is now on Lync. Certainly if you look at a product from Microsoft that is growing most quickly, it is Lync in the enterprise. With the combination of Lync and Skype under the same umbrella, we think we’ll be able to do even more fantastic things together.”

Windows Phone 7

“We’ve gone from very small to very small, but it’s been a heck of a year! [scattered laughs from the crowd]. You’re going to see a lot of progress in that market.”

“Windows Phone 7 sold millions of phones in last year, and 9 out of 10 people would recommend it to a friend. It’s a competitive market, but we have 20,000 apps built for WP7. Nokia bet on Windows Phone over Android, and they are pushing us to go broader geographically. Also Gartner and IDC both did predictions this year that said Windows Phone will be the number 2 phone in 2015. We’ve already shipped two updates, and our ‘Mango’ update available this fall will have 500 new features. We’ve got a lot of work to do, but like the cloud, we’re all in when it comes to mobile devices.”


“Bing is probably the Microsoft product that partners spend the least time with, but I think that’ll change — we’re thinking about developing an architecture that will open up Bing to be more of a platform.”

“Market share for Bing in the U.S. grew to 14 percent this year, up 3 points. It’s a 30 percent growth in number of search queries. In the past year, we’ve integrated in all of the Yahoo traffic, which means we are serving 30 percent of search queries in U.S. We went from 10 percent to 30 in one year.”

Windows Server, Windows Azure and the public and private cloud

“It has been a big year for our private cloud with Windows Server and Hyper-V products and public cloud with Windows Azure … In the last year Windows Server has built market share. Seventy-six percent of servers sold this year were Windows Server, and there’s been equivalent progress with 40 percent of databases running on top of our SQL server database.”

“Having a strategy that spans from public and private is a unique strength for Microsoft. Competitors like VMware, Oracle, Google and Amazon have offers that have merit but in a limited way. We think what you want is to have the flexibility to mix and match the public and private environments.”

Microsoft Dynamics (CRM and ERP)

“This is the 10 year anniversary of entering business application space, and we’ve experienced 20 percent compound annual growth. Dynamics is now its own standalone division.”

“Recently the LA public schools move 70,000 users to Microsoft Dynamics CRM.”

“I’ve been asked: When does ERP in the cloud? Starting with Dynamics NAV early next year we will start putting ERP in the cloud.”

Xbox Kinect (as a possible business tool)

“We brought our Xbox Kinect sensor product to market this year for the entertainment world and yet the amount of interest from businesses and partners in using Kinect in commercial applications is really high.”

Windows 7 and Windows 8

“We’re selling lots of Windows. We saw 350 million new PCs sold in last year, which compares to other guys [that would be Apple] that are in the 20 million range. 350, last time I checked, is a lot more than 20.”

“We did a brief glimpse of Windows 8 at conferences a month or two ago. We made it clear that we are supporting ARM processor architectures in addition to Intel. Windows 8 will be a true reimagining of Windows PCs and the dawning of Windows slates.”

Windows Division CFO and Corporate VP Tami Reller later announced that all Windows 7 hardware will be compatible with Windows 8.