While Microsoft will support thin client devices, there are a number of good reasons for keeping some computational power on client devices such as smartphones, including the ability to conserve bandwidth and enhance graphics.
As an example of smart-client devices, he pointed to the Microsoft Kinect, an XBox online gaming service that uses advanced motion-detection client technology.
Ballmer also emphasized Microsoft's work on the cloud. For the conference, the company announced the release of the Windows Azure Appliance, a prepackaged version of the Azure cloud platform, offered by partners such as Dell, Fujitsu, and Hewlett-Packard, that can be run within an organization's data center.
The company will also run the first Azure professional developers conference this year, in Seattle around September, which will be broadcast over the Internet, said Bob Muglia, Microsoft president of software and tools, during his follow-up keynote
According to Ballmer, the company wants to work with partners to help the get their customers on the cloud. While admitting that partners were initially reluctant to take on the cloud in years past, he counted off the usual reasons for using the cloud: easier distribution and management of applications, less investment in maintenance and greater reach with customers.
Ballmer said that offering large-scale cloud services such the Bing search engine and Windows Live, company engineers have learned many lessons about how to run a cloud service, and the company is in the process of folding what it has learned back into the Azure service, and in Windows Server.
This year's WPC has attracted 9,500 attendees, the largest ever for the conference, according to the company (in addition, 3,000 Microsoft employees are also in attendance).