Ballmer Lays Out Microsoft's 2010 Plans

Despite a power problem that delayed the kick-off to the 2010 Consumer Electronics Show by 25 minutes, Microsoft CEO Steve Ballmer delivered the show's opening keynote, proclaiming "screens" everywhere.

Steve Ballmer
Steve Ballmer

The most important screen, at least tonight, is the new tablet computer coming from Microsoft and partner Hewlett-Packard.

Microsoft showed off three slate PCs, "almost as portable as a phone and as powerful as a PC," all running Windows 7.

The HP slate PC is still a prototype but Ballmer said it will be available "later this year." For all the hype ahead of this announcement, the demo, if you could call it that, lasted only a few minutes, with Ballmer offering no price point, no partnership news or content deals.

Still, what the brief announcement did do was to establish very clearly that Apple will not be alone in the tablet PC space when it unveils its own offering at the end of this month.

At the same time, Microsoft and HP will team up with Bing and MSN default services on HP computers in 42 countries.

Apple may grab the headlines, but Microsoft certainly has the numbers on its side: 300 million PCs shipped in 2009, up 3% year-on-year. In 2010, a jump of 12% is expected, according to Gartner.

Attention quickly turned to Xbox. Microsoft said there are now over 39 million Xbox's around the world. 500 million games have already sold, generating $20 billion in gaming sales.

Microsoft Entertainment and Device President Robbie Bach announced that 'Halo Reach,' a prequel to the wildly popular 'Halo 1,' will also be released this Fall. With over 300 million copies sold, Halo is a bona-fide digital entertainment phenomenon. Bach also said Xbox users can also expect the next installment of the massive 'Call of Duty' franchise which will be coming soon, and exclusively first on Xbox 360.

Xbox Live, with 20 million subscribers, is adding a new member every second of last week. The online multi-media gaming service will see deeper partnerships with content providers outside of gaming in 2010. 100 million songs and games have been downloaded by Xbox Live users. Microsoft will also deepen its relationships with Netflix, Canal Plus and BskyB.

Xbox Live will also be including a new service called "Game Room," featuring 1,000 of the greatest retro video games from the past 20 years. Think Atari and Intellivision. Remember Centipede?

Bach also spent some time talking about Microsoft's Natural User Interface, or NUI, code-named Project Natal for Xbox 360. Big research teams from engineers to psychologists are trying to change the way we physically interact with technology. The idea is to use your body as a controller. It takes the concept of Nintendo's Wii and its neat handheld controller to an exponentially more advanced level.

Project Natal will work existing Xbox consoles and be available for the year-end holiday shopping season. Microsoft is already seeding the game-developer community with algorithms and technology so there will be gaming content available as well.

"This will be the biggest year in Xbox 360 history," Bach said.

Super cool stuff. Can't wait to try that out!

Programming note: Robbie Bach will join us tomorrow on Squawk on the Street around 1015am eastern standard time.

Questions? Comments?