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LAS VEGAS -- Twenty years after his first address at Comdex, Microsoft Chairman and Chief Software Architect Bill Gates this year used his keynote speech to reminisce and observe that some software challenges from the 1980s still exist. He also announced new technologies, in the theme of multimedia products, mobile devices, and smarter software.

Slides from his presentation in 1983, when Gates' father operated the projector, showed software should not surprise users, be trustworthy, follow a consistent model, be easy to understand, and have an undo command.

Back then, Gates said software defined the information age, but suffered from hardware limitations. Today, software defines the "digital decade" and, introducing a concept called "seamless computing," Gates said the challenge is to take advantage of all that hardware offers in a seamless way.

"My believe is that the constraints that we have to get rid of now, the seams that hold us back, are much more about software challenges," Gates said. "The successes of the 1980s were pretty phenomenal, but brought us really only halfway in terms of the dreams about what software can do."

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Microsoft is heavily involved in the seamless computing concept--Gates presented several examples. They include the company's smart phone software, Xbox Music Mixer, the recently updated Windows XP Media Center Edition, and MSN Direct for the forthcoming Smart Personal Objects Technology (SPOT) watches.

At the foundation of seamless computing are the recently launched Office System products, Windows Server 2003, Visual Studio.Net and Web services, Gates said.

Gates hit on several familiar themes. He repeated Microsoft's security promises, offered a demonstration of Microsoft Research search technology, and celebrated the first birthday of the Tablet PC.

To celebrate Tablet PC's birthday, Gates talked about a planned upgrade to Windows XP Pro Tablet PC Edition code-named Lonestar. The update promises to offer better handwriting recognition support, among other features, and is due out mid-2004 as a free update to current customers.

Another demonstration was reserved for "Stuff I've Seen," a search function developed by Microsoft Research that may one day be part of Windows. It captures information that users view on their PC and makes that searchable. It can also pop up and suggest information from that index, for example, while the user is typing an e-mail.

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As expected, Gates also announced e-mail filtering technology called SmartScreen.

Developed by Microsoft Research, SmartScreen will be delivered as "Intelligent Message Filter" for Microsoft's Exchange e-mail server product in the first half of next year. It already is part of Hotmail, MSN and Outlook 2003.

Another new product designed to help technology managers deal with today's technology headaches is Internet Security and Acceleration (ISA) Server 2004. Gates was joined onstage for a demonstration of the product that promises to deliver better application security, simplified management, tighter integration and faster caching. A first beta of ISA Server 2004 is planned for January, according to Microsoft.

Microsoft's Matrix

In a lighter moment, which has become a traditional part of Gates' keynote speech at Comdex, he showed a spoof of The Matrix with Microsoft Chief Executive Officer Steve Ballmer cast as Neo and himself as Morpheus.

Some might think The Matrix is an odd choice for Microsoft to parody since the movie is about the human race being enslaved by malevolent cyberintelligence, basically software. Neo, a hacker, joins Morpheus and his group to destroy The Matrix.

In Microsoft's version, The Matrix is a world filled with IT consultants working for IBM and selling Linux, while the world outside The Matrix is Windows, which "frees the IT masses," Gates says in the parody.