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This article is from the In-Depth Report Consumer Electronics: More Than Just Fun and Games

Games and Search Engines Likely to Drive Consumer Technology in 2010

Although CEO Steve Ballmer's CES keynote was light on major new technology announcements, the company will have Project Natal for Xbox 360 ready to go in time for next Christmas
CES, Ballmer, Microsoft, Natal, Windows 7



© SCIENTIFIC AMERICAN/LARRY GREENEMEIER

LAS VEGAS—On the eve of this year's Consumer Electronics Show (CES) here, Microsoft CEO Steve Ballmer delivered a wide-ranging, if unspectacular, keynote, updating (rather than announcing new) endeavors in the areas of entertainment, automotive and search technology. The address Wednesday evening was a sign of the times for Microsoft, and for the CES, as the company has reserved its biggest news of the past year for other trade shows—for example unveiling its Bing search engine at the All Things Digital conference in May while introducing its Project Natal Xbox 360 controller-free technology at the Electronic Entertainment Expo (E3) in June.

Microsoft Entertainment and Devices Division President Robbie Bach did confirm that Project Natal cameras and sensors would begin shipping by the end of the year, in time for the 2010 holiday shopping season. (This had only been rumored previously.)

The company has high hopes for Natal and for Xbox in general as it competes with Nintendo and Sony for a share of the lucrative gaming market. "Natal will turn you the user into the controller," Ballmer said while pointing out that his company has sold 39 million Xbox 360 game consoles worldwide since its launch in 2005. Game-makers have sold 500 million copies of Xbox games since the original console's 2001 debut, raking in about $20 billion in sales in the process.

Bach ran through a list of Xbox 360 titles that will be released in the coming months—including Mass Effect 2, Tom Clancy's Splinter Cell Conviction, Call of Duty Modern Warfare 2 and, of course, Halo Reach, the latest version of that immensely popular title. Xbox 360 will also see a new genre of game, the psychological action thriller, launched this year in the form of a new title called Alan Wake, according to Bach. This game will be like an episode of the TV show Lost written by Steven King and filmed by David Lynch, Bach said.

Microsoft is likewise counting on Bing, and a partnership struck up with Yahoo in July, to help challenge Google's dominance in the search space. Microsoft and Yahoo signed a 10-year deal that calls for Yahoo to replace its own search engine technology with Bing and make its search sales force available to Microsoft to attract large advertisers. The deal is equally important for Yahoo, whose star has faded in recent years. (Yahoo CEO Carol Bartz had been scheduled to deliver a CES keynote on Thursday but canceled a few weeks ago for unspecified reasons.)

Ballmer also indicated a strong effort to promote Bing, which has added 11 million new search users since going live in early June. Hewlett–Packard plans to provide Bing as the default search engine on PCs it sells in 44 countries, Ballmer said, adding, "We know we are at the beginning of a long journey but we think we're off to a pretty good start."

Ballmer credited Windows 7, a highlight of his 2009 CES keynote, with boosting PC sales during the 2009 holiday season, which were 50 percent above 2008 holiday season sales. During one of his keynote demonstrations, Ballmer showed how students could use Blio eReader or SkyDrive online file storage software running on Windows 7 PCs to browse digital textbooks and share information.

Several other demos were dedicated to demonstrating how Windows 7 works with other Microsoft multimedia software, including Windows Media Center and Media Room as well as the newly unveiled Slate PC, a thinner update of the touch-screen tablet PC that Microsoft has been pushing for nearly a decade. Ballmer showed off Windows 7 on a prototype Slate PC that HP plans to begin selling later this year.

The automotive industry is also going to be important to Microsoft as carmakers continue to add the company's operating systems and software to their vehicles. Ford already uses Microsoft software as part of its Sync in-car communications and entertainment system. Fiat Auto has sold one million cars equipped with the Blue&Me (a voice-activated in-car Bluetooth system that uses the Windows Mobile operating system) and EcoDrive, an app for collecting vehicle efficiency info that runs on the Microsoft Auto in-car operating system. Kia is planning to add its UVO voice recognition software (which likewise runs on Microsoft Auto) to the Sorrento models it sells beginning this fall.

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