Update: Ballmer eyes Linux, Google users for growth

Microsoft Corp. Chief Executive Officer Steve Ballmer believes the company has ironed out all of the security problems in its forthcoming Windows Vista operating system so that users can consider adopting it the first day it is released. For the most part.

"Most people will trust it from day one on their home computer, and then they will have to decide about their corporate [PC]. I encourage you to get it early but I must be honest among friends," Ballmer joked Wednesday before an audience of IT professionals and analysts at Gartner Inc.'s Symposium and ITxpo 2005.

In a wide-ranging chat with Gartner analysts Tom Bittman and Dave Cearley, Ballmer touched on some of the prominent topics surrounding Microsoft this year, including its all-out effort to improve the security of its products, the competitive threat from Linux and Google Inc., and delays in the long-awaited successor to the Windows XP operating system, Windows Vista.

Windows Vista, formerly known by its Longhorn code name, was originally supposed to be available by now as an ambitious upgrade to Windows XP. It was supposed to include a new file system and a new presentation surface, among other things, but Microsoft was unable to make sure all the new components of the OS would interoperate in time for its current launch date, the second half of next year, Ballmer said.

Instead, Microsoft decided to roll out those components over time after the launch of Vista, Ballmer said. This also gives the company's developers time to run code through tools designed to probe for security weaknesses, he said.

In the meantime, Microsoft is faced with having to grow its business in a new world where PC users often bypass the desktop to use applications delivered over the Internet, Bittman said. "In the 1980s, the strategy was about API [application programming interface] control; in the Internet world, it's more about interoperability and Web services," he said.

In response, Microsoft is encouraging Windows developers to also build applications that deliver software programs over the Internet, Ballmer said. The company is also looking to nurture the development of applications that bridge the desktop environment and the Internet, he said.

"We think there is an aspect to what we do that has to be client, server, and software as a service," Ballmer said.

With companies like Google and Yahoo Inc. developing a strong presence on the Internet based on the quality of their search results, Microsoft must also look to leapfrog those companies with new search capabilities and technologies, Ballmer said.

"In general, 50 percent of searches do not lead to the desired outcome. Does anybody not believe that the search experience is going to be dramatically better 10 years from now? Does anybody deny it would be nice to search within the enterprise and outside the enterprise?" Ballmer asked the audience.

"We see plenty of opportunities in things that Google might or might not do. If you read the newspapers today, other than curing cancer, Google will do everything." Ballmer said.

Microsoft has to walk a fine line as it develops its Web products, between evangelizing the idea of basic computing delivered over the Web and continuing to promote its Windows and Office franchises, Bittman said in an interview after Ballmer's address.