Seamless Computing Opportunities & Challenges for China Kai-Fu Lee Corporate Vice President Microsoft Corporation

Seamless ComputingOpportunities & Challenges for China

Kai-Fu LeeCorporate Vice PresidentMicrosoft Corporation

Talk OutlineTalk Outline

IT & GrowthIT & GrowthSeamless ComputingSeamless ComputingOpportunities for ChinaOpportunities for China

Software :Software : Engine of growthEngine of growth

Power of software today:Power of software today:US$200 Billion industryUS$200 Billion industry

10 million well-paid professionals10 million well-paid professionals

Increased efficiency everywhereIncreased efficiency everywhere

5 times faster growth than GDP5 times faster growth than GDP

Will the growth continue?Will the growth continue?Microsoft: YES!Microsoft: YES!

Microsoft R&D:Microsoft R&D:

1998 : $3 billion1998 : $3 billion

2004 : $7.9 billion2004 : $7.9 billion

What fuels this growth?What fuels this growth?Moore’s lawMoore’s law

Waves of innovation.Waves of innovation.

PC ArchitecturePC ArchitectureOperating Operating SystemsSystems

SpreadsheetsSpreadsheetsWord ProcessorsWord Processors

PCPC19801980

InternetInternet19951995

ApplicationsApplications19901990

Seamless Seamless ComputingComputing

20052005

Speech/WritingSpeech/Writing

XML/SOAPXML/SOAPHTTP/HTMLHTTP/HTMLSMTPSMTP

InternetInternetWeb BrowserWeb BrowserEmail ClientsEmail Clients

Wi-Fi/BroadbandWi-Fi/BroadbandDevices Devices everywhereeverywhereWeb ServicesWeb Services

Rights ManagementRights ManagementTrusted Computing Trusted Computing HardwareHardware

MouseMouseGUIGUILANsLANs

Desktop publishingDesktop publishingEnterprise Enterprise applicationsapplications

Waves of InnovationWaves of Innovation

Research & Research & DevelopmentDevelopment

Engineering Intellectual Property

Market AdoptionMarket AdoptionIntellectual Property Economic Value

Information Information DrivenDriven

Information Information DrivenDriven

ExperiencesExperiencesExperiencesExperiences

ConnectedConnectedConnectedConnected

Self-Self-organizationorganization

ReplicationReplication

Speech & Speech & Intelligent Intelligent

UIUI

ContentContentAddressabilityAddressability

Amazing visualizationAmazing visualization

Machine-to-Machine-to-Machine Machine

InteractionInteraction

Person-to-PersonPerson-to-PersonInteractionInteraction

Person-to-Person-to-MachineMachine

InteractionInteraction

Ink &Ink &HandwritinHandwritin

gg

Seamless Computing:Seamless Computing: The Next The Next WaveWave

GraphicalGraphicalUser InterfaceUser Interface

Natural Natural User InterfaceUser Interface

User Interface EvolutionUser Interface Evolution

Command lineCommand line

19851985PCPC

19901990GUIGUI

Multiple WindowsMultiple WindowsMenusMenus

19951995InternetInternet

HyperlinksHyperlinksSearch EnginesSearch Engines

Digital DecadeDigital DecadeXMLXML

Web ServicesWeb ServicesSmart devicesSmart devices

Natural LanguageNatural LanguageMultimodal (speech, ink…)Multimodal (speech, ink…)

Personal AssistantPersonal Assistant

Natural User InterfaceNatural User InterfaceDo what I meanDo what I mean

NUI InteractionNUI InteractionNatural & task-basedNatural & task-basedExpressive & efficientExpressive & efficientScalable & adaptiveScalable & adaptive

NUI InteractionNUI InteractionNatural & task-basedNatural & task-basedExpressive & efficientExpressive & efficientScalable & adaptiveScalable & adaptive

“ To me, speech recognition will be a transforming capability … when you can speak to your computer and it will understand what you're saying in context.”

– Gordon Moore

“Speech and natural language understanding are the key technologies that will have the most impact in the next 15 years.” – Bill Gates

A Roadmap Towards NUI A Roadmap Towards NUI VisionVision

TTS SR DialogTTS SR DialogSpeech

Search Help Tasks Q&ASearch Help Tasks Q&A

Text

Delegation & Pro-ActiveDelegation & Pro-ActiveFederation Agents PlanningFederation Agents Planning

Multi-Modal/Task-Based




Text



Buy 100 shares of Microsoft




Text



Buy Microsoft stock




Text



Find email from John about the budget




Text



Protect my PC




Text



Print address labels from Outlook Contacts




Text



What is the best University in California?




Text



Send flowers to my wife on her birthday




Text



Hold all calls unless it’s urgent




Text



I want to plan a vacation to Europe

Speech Accelerated by…Speech Accelerated by………Super-Moore’s LawSuper-Moore’s Law

Enable human-level speech recognition Enable human-level speech recognition (SR):(SR):

Leveraging Moore’s Law + more data + researchLeveraging Moore’s Law + more data + researchPredictable 10% error reduction or more per Predictable 10% error reduction or more per yearyearHuman-level performance possible in 10-20 Human-level performance possible in 10-20 yearsyears

Also enable natural language, Bayesian Also enable natural language, Bayesian learning….learning….

TasksTasksSR error SR error raterate

Human Human error rateerror rate

SR-Human SR-Human GapGap

Free style Free style transcriptiontranscription

30%30% 4%4% 19 years19 years

Alphabet lettersAlphabet letters 5%5% 1%1% 15 years15 years

Read newspaper Read newspaper transcriptiontranscription

3%3% 0.9%0.9% 11 years11 years

IT & Software :IT & Software : Opportunities for Opportunities for ChinaChinaChina China

China = #1 factor in Asia’s China = #1 factor in Asia’s growthgrowth

Huge marketHuge market#2 PC market in the world#2 PC market in the world

#1 phone market in the world#1 phone market in the world

Huge growthHuge growth25% CAGR in IT25% CAGR in IT

50% in software & services50% in software & services

0

5

10

15

20

25

30

35

40

45

50

2000 2001 2002 2003 2004 2005

Ch

ina

's I

T S

pe

nd

ing

(U

S$

B)

Opportunities•Leverage strong traditional industries•Large talent pool•Outsourcing becoming global trend

Challenges•Lacks software eco-system•Lacks IT leadership talent•India is far ahead in outsourcing

India :India : World Leader in OutsourcingWorld Leader in Outsourcing““ Ideal” population for outsourcingIdeal” population for outsourcing

English-speaking country with good educationEnglish-speaking country with good education

Entry-level call center jobs with growth pathEntry-level call center jobs with growth path

700 million people under 35700 million people under 35

Highly adaptable cultureHighly adaptable culture

Process leadershipProcess leadershipCost optimizationCost optimization

““Go to India for cost; stay for quality”Go to India for cost; stay for quality”

Valuable companies with ambition beyond Valuable companies with ambition beyond outsourcingoutsourcing

Top 4 companies worth US$50B showing astounding Top 4 companies worth US$50B showing astounding growthgrowth

Good environment for start-up companiesGood environment for start-up companiesOpportunities

•Insatiable demand for outsourcing•Aspiration to build software company

Challenges•Lacks infrastructure/modern cities•Lacks domestic market

Recommendations for Recommendations for ChinaChinaTodayToday: :

LearnLearn by building an outsourcing industry (like by building an outsourcing industry (like India):India):

Learn from Indian companies, build 2-3 large companies.Learn from Indian companies, build 2-3 large companies.Stimulate software companies with high-demand US Stimulate software companies with high-demand US customerscustomersBe willing to take on “simple” work (testing, localization)Be willing to take on “simple” work (testing, localization)Educate talent with English, int’l sales, large proj. mgmt. Educate talent with English, int’l sales, large proj. mgmt. skillsskills

DevelopDevelop a Chinese IT software industry (like US): a Chinese IT software industry (like US):Leverage China’s huge domestic market & traditional Leverage China’s huge domestic market & traditional industriesindustriesBuild on areas where software value is understood Build on areas where software value is understood (enterprise)(enterprise)Educate talent with market research, customer-focus Educate talent with market research, customer-focus experienceexperience

LeadLead by finding leapfrog opportunities that favor by finding leapfrog opportunities that favor China:China:

Web services : Disruptive change + advantage for local Web services : Disruptive change + advantage for local playersplayersMobility & phone : Unique market that is advanced & Mobility & phone : Unique market that is advanced & largelarge

EducateEducate leadership talent by improving higher leadership talent by improving higher educationeducation

““Hard skills” : international business, management, Hard skills” : international business, management, processprocess““Soft skills”: teamwork, communication, “EQ”Soft skills”: teamwork, communication, “EQ”

FutureFuture: Software export to international : Software export to international marketmarket

ConclusionConclusion

Opportunities for ChinaOpportunities for China•Learn by starting an outsourcing industry•Develop own IT ecosystem from traditional industries •Lead by finding opportunities to leapfrog•Educate engineering talent to become leadership talent

Software is the proven &Software is the proven &continual engine of growthcontinual engine of growth

China will harness this engine to China will harness this engine to become a world technology leaderbecome a world technology leader

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© 2004 Microsoft Corporation. All rights reserved.© 2004 Microsoft Corporation. All rights reserved.This presentation is for informational purposes only. This presentation is for informational purposes only.

MICROSOFT MAKES NO WARRANTIES, EXPRESS OR IMPLIED, IN THIS SUMMARY.MICROSOFT MAKES NO WARRANTIES, EXPRESS OR IMPLIED, IN THIS SUMMARY.

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Seamless Computing Opportunities & Challenges for China Kai-Fu Lee Corporate Vice President Microsoft Corporation