Corrected version
Steve Ballmer publicly addressed critics who say he should step down as Microsoft chief executive.
"You tell me if I lack the energy, conviction ... or drive," Ballmer said to an audience member who asked what he thought of people who say it's time for him to go.
Ballmer spoke at a lunch for the Seattle Rotary Club at the Westin Hotel on Wednesday. It was the first time Ballmer spoke to the group in 15 years.
Ballmer pre-announced what sounded like Microsoft's earnings for the 2011 fiscal year, which the company is scheduled to report on July 21.
"There's a reason why we'll do almost $70 billion in revenue this year and we'll make over, 20, whatever, $26, $27 billion in profits," Ballmer said.
Bringing the NBA back to Seattle
An audience member asked him about bringing an NBA franchise to Seattle. Here is Ballmer's response.
"The challenge there is a real estate challenge. Honestly, the building that is Key Arena would not be able to have an NBA team that would be competitive," he said, adding it's a nice building to look at. "If you don't have a certain kind of arena, you can't sell tickets at a certain price ... you can't pay players to be a competitive team."
He said it takes $300 million, $400 million, $500 million to build a competitive arena, and that either needs to come from real estate investment or the city, county and state, which was not interested before in making the investment.
"If somebody could solve the real estate problem, someone could solve the NBA problem," he said, and he added it's up to the real estate industry to solve it. "If you find an answer to that problem, I'll buy the first season ticket."
Three most important areas of innovation
Ballmer summed up the future of technology for Rotarians and what they should watch for.
"I come to you with a message of optimism of how how much more is coming and how much opportunity remains," Ballmer said.
He identified the three most important areas of technology innovation as: the ability for computers to recognize you, the ability of computers to understand what you want and cloud computing.
"No. 1, your computer will learn to recognize you, your voice, your fingers," he said. The ability to use our fingers on touchscreens was the start he said. "Oooh, I can touch it now too," he said. "When I say it it sounds small but we all know how profound that is." Microsoft built Kinect, a camera that senses motion and sound, for the Xbox video game console, and will be bringing it to Windows for use with computers.
"The second biggest thing I think is my computer will learn to understand me," Ballmer said. "If I say to my administrative assistant, 'Get me ready for my trip down to Rotary,' she's brilliant" and she knows to get him directions, notes and a biography of who he will be meeting with, he said. "If I go to my computer and say, 'Get me ready for Rotary,' it has no idea where to look. ... That's why people fall in love with search engines. It's why we're investing so much in Bing. You can type in what you want in your own language. ...
"The cloud is the buzz word that connects you to the Internet," Ballmer said. "That back end phenomena will be the source of so many new companies ... that it will be quite an exciting time for the next five years."
Here is our earlier story on investor David Einhorn saying Ballmer needs to go. (It's also been suggested by multiple anonymous readers who comment here at seattletimes.com.)
I will add more highlights from Ballmer's speech Wednesday afternoon, so come back here for more.
Update 3:43 p.m.:
SEATTLE TIMES
Assunta Ng, publisher of Northwest Asian Weekly
The person in the audience who asked Ballmer his reaction on critics who say he needs to go was Assunta Ng, publisher of the Northwest Asian Weekly. "I was hoping mine was not the first question," Ng said after the lunch, but the microphone referee shoved it to her first.
"What do you expect him to say? He knows that the criticism is that while he was there he hasn?t really helped the stock price of Microsoft, right? It was just not good. Sometimes it?s even horrible. ... He has done great things at Microsoft but a lot of people are trying to compare him with Bill Gates, that he is not as tech savvy as Bill."
Here are more highlights from Ballmer's speech.
How Washington state needs to step up for businesses like Microsoft
Ballmer called Seattle the most important technology hub after the Bay Area and talked about what he thinks the state needs to invest in.
"After Silicon Valley it's hard to cite any place more important to technology," he said. "We need to make key investments in transportation infrastructure." Ballmer said he lives close to the 520 and is happy to see the changes going on with the bridge over Lake Washington.
"We're all going to have to step up to do more for K-12," he said.
Microsoft recently gave $25 million to build a college scholarship endowment for students in Washington State. Microsoft attorney Brad Smith chaired a task force for the governor that led to both the endowment and legislation giving colleges the ability to set their own tuition. Regents at the University of Washington are considering a large hike to tuition. Here is our story by Katherine Long on UW tuition.
On the investment Microsoft is making in Windows
Ballmer declined to put a number on how much Microsoft is investing in Windows 8, the code name for the next version of Windows. "If you cut me open and see what's inside, it's Windows," he said. "Windows, Windows, Windows."
"How important is Windows? Very. 'Very' would be a very fair answer," he said.
On Microsoft's commitment to search
Google dominates search, but Ballmer said Microsoft is not backing off of its commitment to build a competitor in Bing, even though Microsoft is losing money on Bing.
"While we may lose a few million this year in Bing we are irrepressible in our commitment to that," he said.
Information in this article, originally published June 29, 2011 at 2:01 p.m., was corrected June 29, 2011 at 5:22 p.m. A previous version of this story incorrectly quoted Steve Ballmer saying, "They're the reason we will make more than $70 billion this year and, give or take, $26 billlion to $27 billion in profits." The correct quote is: "There's a reason why we'll do almost $70 billion in revenue this year and we'll make over, 20, whatever, $26, $27 billion in profits."
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