As expected, Microsoft's brief multi-touch demonstration of Windows 7 garnered most of the headlines, but when the crowd goes one way sometimes it makes sense to go the other way. And if you go away from the crowd you'll notice more than a few subtle hints were dropped about how Microsoft is changing the way it does business.
First, the big headlines (Techmeme). Microsoft said Windows 7 will get multi-touch capability. Mary Jo Foley confirmed that tidbit on Tuesday. The other big takeaway is that Vista will be the kernel for Windows 7. That's another interesting nugget since it may indicate that Windows 7 will work better with all of Microsoft's hardware partners out of the box. Ed Bott had noted the Vista kernel point on our little roundtable on Friday. News.com and Dan Farber had all the live coverage of D6 (roundup) with the hits and runs and errors.
But what stood out for me was the following:
Add it up and it's safe to say the Microsoft you see today won't resemble the one you see five years from now. Microsoft's soul--Gates--retires in a month or so and you have to wonder how his departure will impact the company. Ballmer and Gates have great chemistry and it's unclear whether that can be maintained with Gates playing chairman and focusing on his charity work.
Of those aforementioned model questions, the most challenging one to tackle will be the final one--leapfrogging on the Windows UI front. Looks matter. So does functionality. Apple has raised the bar and even if you disagree with that you'll have to admit there's something to controlling the hardware and software. How can Microsoft manage that entire ecosystem and be competitive? It's shocking that Microsoft's herding cats routine works as well as it does, but there's a management case study waiting to be written if the software giant can up the ante.
The other things on Microsoft's to-do list--changing leadership, decoupling the OS, figuring out the mobile model and growing advertising--are all doable. And they will get done. The big question is whether Microsoft can take its ecosystem to a new level.
Here's the video from the Gates-Ballmer chat:
Part 1
Part 2