CES: The Company That Wasn’t There

by Steve Wildstrom   |   January 15th, 2014

 

Steve Ballmer at CES 2012

Steve Ballmer in happier times, at CES 2012

For many years, Microsoft set the tone for CES with a keynote the evening before the annual consumer electronics extravaganza opened. It was always heavily attended and heavily covered, and there was usually at least one piece of significant news. On the show floor, Microsoft  had a huge, prominent booth, conveniently located at the point where attendees were most likely to enter the sprawling Central Hall of the Las Vegas Convention Center.

At its 2012 appearance, CEO Steve Ballmer (above)  announced Microsoft would not be coming back. But last year, even with its keynote slot taken up by Qualcom’s Paul Jacobs and its floor space occupied by Chinese TV maker Hisense, Microsoft managed to be a presence at CES. There was considerable interest in the newly released Windows 8  and Windows RT, and in the Surface and Surface Pro tablets and Ultrabooks.

This year: Nothing. Microsoft, of course, had a presence in Las Vegas, a suite of meeting rooms at one of the hotels. But far more notable than the lack of official participation in CES is the near-zero mindshare Microsoft had on both participants and its erstwhile partners. After all, Apple has managed to be a looming presence at CES for years without ever taking an official role. In 2007, it notoriously drew a huge chunk of CES media from Las Vegas to San Francisco to cover the mid-CES launch of the original iPhone. In an astonishingly short time, Microsoft has gone from being the great, feared bully of the tech world to being a company that most people rarely think about.

 To the extent that CES is a reflection of the viability of Microsoft’s consumer offerings, the company has some big decisions to make.

The fact that Microsoft was neither seen nor talked about at CES is probably a reasonable reflection of the company’s current place in the consumer world. The new Xbox One is selling fairly well, though not as well as the Sony PlayStation 4, but it doesn’t seem to be generating a great deal of excitement. I saw Xbox Ones here and there around CES, along with a larger number of Xbox 360s, but without Microsoft’s sponsorship, there was no one to generate Xbox buzz. By contrast, Sony dedicated a substantial part of its exhibit to PS/4 and the display included a stunning video wall on which a PS/4 FIFA World Cup game was being played (photo below).

sony-fifa-wall

For Microsoft, the Intel exhibit may have been the low point of the show. Intel and Microsoft long were  neighbors on the show floor and effectively promoted each other’s products. There were a fair number of systems, mostly Ultrabooks, running Windows in the Intel booth. But Intel grabbed a lot of attention by announcing that it would be promoting laptops running both Windows and Google’s Android software. And the center of interest of its display was a section promoting its new ultra-small, ultra-low-power Edison system on chip and particular, its entry into the Internet of babies: The Mimo baby monitor from Rest Devices, a tiny plastic turtle that slips into a specially designed onesie and beams data on your baby’s motions and vital signs–to your iOS or Android device. Edison is based an on x86 processor, but devices based on in are going to run Android or Linux, not Windows.

Among leading leading laptop makers, only Lenovo was present on the floor. 1  HP and Dell skipped the show floor altogether. And while companies such as Toshiba, Samsung, Sony, and Panasonic showed laptops, they did not get very prominent placement.

Microsoft, of course, still has a healthy enterprise business, and you would not expect that to be reflected at CES. But to the extent that CES is a reflection of the viability of Microsoft’s consumer offerings, the company has some big decisions to make. Its acquisition of Nokia seemed to represent a decision to stick with and rebuild the consumer market, but so far it is not helping. As Microsoft goes through its protracted selection of a new CEO, it has to decide whether it really wants to be in consumer markets–and just what sort of investment it will take to become relevant again.

  1. The original version erroneously said Lenovo was among the absent. []

Steve Wildstrom

Steve Wildstrom is veteran technology reporter, writer, and analyst based in the Washington, D.C. area. He created and wrote BusinessWeek’s Technology & You column for 15 years. Since leaving BusinessWeek in the fall of 2009, he has written his own blog, Wildstrom on Tech and has contributed to corporate blogs, including those of Cisco and AMD and also consults for major technology companies.
  • Space Gorilla

    Only sort of on topic: What happens to the XBox, etc when my iPhone/iPad is as powerful and I can set it on my coffee table, connect to my Apple TV, fire up a game, use a wireless handheld controller, and play the game on my big screen TV? Are we really that far away from this scenario?

    • Herding_sheep

      Thats certainly a possibility and likely to happen eventually.

      However, the only thing that’s going to hold back an iOS device challenging the dedicated console is going to be the relatively small internal storage. An iOS device comes with an average 32gb storage, a single blu-ray holds 50gb with 500gb internal storage available. High production, expensive AAA video games use around 30-50 gb of storage on the disc. There’s just no feasible way to bring these titles with this level of production value and budget to an iOS device.

      So for the time being, the blockbuster games of the gaming industry will remain on consoles, where they can fill a blu-ray to the max with detailed cutscenes, voice acting, motion capture, high resolution textures, etc. Mobile devices will still get games that are appropriate for the form factor, smaller bite-sized but incredibly fun games that occupy less attention span.

      The other likely scenario is that AAA blockbuster video games all but become extinct in favor of cheaper, more profitable mobile games littered with IAPs and ads. As a gamer myself who has been gaming since the days of the NES, this is something I would be very sad to see.

      • Space Gorilla

        I think there’s a middle ground, games like Oceanhorn, Badland, Limbo, Kingdom Rush, Real Racing, and tons more, those are great games. The latest Lego Lord of the Rings on the iPad is another example. I think maybe we’ll just end up with a new and different kind of AAA blockbuster video game. Angry Birds is another one, great, great game, so much fun. Imagine the multiplayer possibilities with many iOS devices and controllers hooking into one game. I think it’ll be a lot like the Wii, simpler but a ton of fun, ‘gaming for the rest of us’.

        On the storage issue, I wonder if an Apple TV Pro could solve that. Why couldn’t the storage for larger games be on the Apple TV box? Or maybe Apple’s got some other solution up their sleeve.

        • Herding_sheep

          I completely agree that OceanHorn is an example of great quality on an iOS device. But these are outliers. And technically speaking, the technology inside the game is not very demanding as far as animation/cutscenes and textures go, but its filled to the brim with charm and of course the amazing Uematsu soundtrack (something I hope to see more of in iOS games).

          But realistically, a game on a PS4 can simply store a ton more data and assets. Full voice acting, high fidelity facial recording (like in GTA 5), precise motion capture, cutscenes, etc use up a TON of data. Remember how FF7 came on 3 discs? That was due to the cutscenes, which were a breakthrough at the time. These sort of things that we are accustomed to in high budget console games just aren’t possible on iOS simply because of storage, not due to any technical limitation. This is actually something that John Carmack talked about. So while we do occasionally see gems which push the limits on iOS, it is not too prevalent.

          Now an Apple TV could solve this problem. Or even streaming the games, like Sony’s newly announced Playstation Now service. I think we’ll get there eventually. I just hope the casual quick buck market doesn’t overtake the market for high production value, very deep games.

          • Space Gorilla

            I would love an Apple TV that I could store my movies on directly. I don’t like the lag over Airplay, even a tiny bit annoys me. But perhaps that isn’t practical. You’d need an Apple TV with a few terabytes at least. Maybe some kind of modular storage goo that hooks into the Apple TV, that might be more practical. The Apple TV is the brains, and then you chain in whatever amount of storage you need for your games, music, movies.

  • Mauryan

    I dread the thought of an Intel chip heating up a baby’s butt. One does not need an iPhone to hear its cries. Only certain things belong in the diaper. If Intel thought that was the place to go in, they are sending the wrong message. Just kidding!

  • jfutral

    I would like to ask the inverse question. What does Microsoft’s absence say about CES? I’ve seen zero mainstream news coverage of the event this year. If not for many (and not even that many to boot) tech blogs I wouldn’t have even known the event took place this year.

    I know this is a different kind of conference, but this is a trend I am seeing from other industry trade shows—companies getting off the show floor and reserving suites at one of the nearby or host hotels for private meetings.

    Joe

    • Space Gorilla

      Perhaps the Age of the Nerd is over.

    • Another_Lurker

      Trade shows are not for the general public but for vendors and competitors to see what is each other is planning. Also, there is a need to connect with buyers and the trade press.

      If a company does not attend a major trade show such MS at the CES often it is because they do not believe the market is important to them. So reading the tea leaves, MS does not really value the consumer market.

      • steve_wildstrom

        I think it is more correct to say that Microsoft is at war with itself over the consumer market, leaving them in a position where they can neither fully commit nor get out. The problem is that their half-hearted consumer efforts are hurting them in the business market.

      • jfutral

        “Trade shows are not for the general public but for vendors and competitors to see what is each other is planning.”

        This is where I actually get to provide first hand insight from having been a part of planning and designing (even being a part of some for arts orgs) a number of trade show booths for many industries, including electronics (anyone remember Comdex?), although never CES. Don’t kid yourself for a minute that trade shows are not for the general public. Trade shows have _traditionally_ been key points to generate buzz among a particular industry, the press, and the public.

        But there is nothing cheap about a booth, small or large, particularly ones as large as MS usually employs. All one has to do is remember Steve Jobs reasoning for ditching MacWorld. It is the same or similar reasoning everyone else is using everywhere. The cost vs the benefits are just not what they used to be. Most business is done and deals made away from the show floor anyway. The show floor is just for show.

        MS certainly has its issues, I agree wholeheartedly about that. But MS skipping CES (along with a few other major players, IIRC) says as much about CES as it does about MS.

        Joe

        • steve_wildstrom

          Joe, I just want to clarify that my point was not to criticize Microsoft for not being on the floor but to note that no one seemed to think or care about Microsoft. That was most certainly not true of Apple, which has never participated in CES.

          • jfutral

            Right. Sorry. I do get that. But I am also amazed at how a lot of people didn’t seem to notice CES, either. I think that is as relevant an observation as no one noticing MS at CES (either directly or through third party vendors). I think trade shows as an industry are waning in their importance. Not totally obsolete, but less central. This is a bit of a veer into the decentralization of a lot of things in our society these days, not just trade shows or the PC (as in Ben’s article).

            Joe