Ballmer Touts Windows 8, Surface To Partners

Microsoft chief executive Steve Ballmer has assured manufacturing partners that Microsoft’s own Surface tablet will not undercut partners’ Windows 8 opportunities

Microsoft chief executive Steve Ballmer assured OEMs that they will certainly have an opportunity to successfully sell laptops and tablets running Windows 8 even as Microsoft introduces its own tablet, called Surface, with the new operating system.

“Surface is just [one] design point,” Ballmer said in remarks on 9 July before an audience of about 16,000 Microsoft partners gathered in Toronto. “It will have a distinct place in a broad Windows ecosystem and the importance of thousands of partners that we have that design and produce Windows computers will not diminish.”

Undercutting partners

Microsoft’s decision to build its own tablet tightly integrated with Windows software has been seen as undercutting OEMs like Hewett-Packard, Dell, Acer and others, which have for years licensed software from Microsoft and built their own hardware. But Ballmer said he expects Microsoft and its OEM partners will offer “a spectrum of stunning Windows devices”.

At the World Partner Conference, Tami Reller, corporate vice president and chief financial officer of the Windows and Windows Live Division at Microsoft, showed off a number of coming devices that will run Windows 8 from Acer, Asus, Dell, HP, Lenovo and Samsung.

Reller also said that the release to manufacturers (RTM) of Windows 8 will come as soon as the first week in August and that general availability (GA) of the OS will occur by the end of October. The RTM is the date that manufacturers can start installing Windows 8 on devices, while the GA is when those devices can go on sale and when customers can upgrade existing hardware to Windows 8.

Windows 8 will come in two variations, one for devices built with an x86 processor architecture and another, called Windows RT, for ARM processor devices.

Also at the partner conference, Kurt DelBene, president of the Microsoft Office division, unveiled a new incentive programme for partners who sell Office 365, which is the Office productivity software suite delivered in the cloud that the company introduced one year ago.

Top-line revenue

Under the Office 365 Open programme, “You guys own the top-line revenue. It means you get to bill your customers directly for Office 365. And you get to sell a single package, a single solution to customers.”

The package, DelBene explained, would combine Office 365 with other value-added services partners would offer themselves, all in one invoice for the customer. Microsoft also updated the Office 365 Advisors Programme, making partners who sell more than 150 seats of the cloud service eligible to earn more revenue.

DelBene also touted the $1.2 billion (£773m) acquisition of the enterprise social media service Yammer, which will be managed within his Office Division. Yammer will combine the viral adoption model of the service, which grew because individual employees at various companies signed up for it on their own, with integration with Office products such as SharePoint, Exchange, Outlook and others.

Ballmer added: “This viral adoption model is 100 percent consistent with the consumerisation of IT that gets talked about so much. It’s a service that the end user can pick before you or we or IT gets involved.”

However, he added, IT will be able to create controls on the Yammer system for security and privacy of communications.

Improvements ahead

Ballmer ran through the many announcements Microsoft made over the last year and the improvements that lie ahead, including additional content released for Xbox and the coming addition of a browser to the gaming system, a new release of the Bing search engine incorporating social media results, the completed $8.5 billion acquisition of Skype with its 250 million monthly users, and the coming Windows Phone 8 mobile operating system.

Ballmer said that Microsoft’s partners earned combined revenue of $690 billion in 2011, up 13 percent from the year before.

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