Microsoft's latest software-to-software message is overshadowed by a two-pound prototype of one of its next-generation form factors.

Even when it comes to a Bill Gates keynote, gee-whiz hardware upstages software every time with the Comdex/Fall '00 crowd.

Sunday night proved no exception.

Microsoft's (Nasdaq: MSFT) chairman and chief software architect spent the vast majority of his more than 90-minute keynote outlining Microsoft's view of the future software-to-software development paradigm centered around Microsoft .Net.

But the 11,000 attendees seemed to be most impressed by Microsoft's demonstration of a future Tablet PC form factor. Microsoft said its partners wouldn't ship a Windows-based tablet until 2002 at the earliest.

The tablet prototype, which Gates called "the ultimate .Net client," used electronic ink technology that will allow users to write directly on the tablet screen, like they do today with paper. The ink and screen technologies in the tablet will allow users to do everything from search their handwritten notes, to open up screen space to add annotations at a later date.

Gates focused on presenting a case for why tablets and other hardware devices will require a fully featured operating system and suite of applications -- not the browser-based client espoused by many in the high-tech industry.

Fat client nirvana

Microsoft's key message, as articulated by one of the developer tool product managers, who did a demo during Gates' presentation, stated succinctly Microsoft's high-level view: The best possible user experience will occur when using a rich client.

"We're at a very key transition point," Gates told the Comdex audience. "There will be lots of different devices, but a new software model based on XML."

This software model, which Gates called software-to-software, representing a departure from client-server, centralized, and point-to-point computing models, is Microsoft's latest attempt to explain its .Net computing initiative.

"For the first time, the browser model is really showing its age," Gates claimed. "We need development tools and standards to take it to another level."

Gates revealed that Microsoft released beta one of Visual Studio .Net development suite on Friday, and began shipping discs to 10,000 developers. Gates also put Office 10 beta 2 through its paces for the Comdex audience. Visual Studio .Net and Office 10 are both due to ship next year.

Another take on .Net

Gates said Microsoft's software-to-software model, aka, .Net, will allow information to be customized and accessed wherever customers need it. He added that such a model will provide user-controlled privacy and notification via information agent technology.

It will be based on products that provide rich user interfaces, with speech, ink, and multimedia handling capabilities. And it will require Microsoft's forthcoming generation of development tools, operating systems, and desktop office products to run best.

Gates attempted to differentiate software-to-software model from the peer-to-peer model that Napster made famous. He said peer-to-peer doesn't rely as much on servers, to provide a rich computing environment, as it does on clients.

"Sometimes you want the server to provide the richness," Gates said. A pure file-sharing model is inadequate, Gates maintained. "Rich information needs to work in all ways -- client-to-client, client-to-server, and sever-to-server."

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