Inside Microsoft's Brilliant Acquisition of Perceptive Pixel

Microsoft may have just assembled the arsenal it needs to clobber Apple in the coming battle for the future of computing.
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Microsoft CEO Steve Ballmer this week announced that the software giant would acquire Perceptive Pixel, Inc. (PPI). Terms of the deal were not disclosed.

PPI is best known as the company that makes those big interactive displays that CNN called its “Magic Wall” in the 2008 presidential race. CNN was also an investor in the privately held company, as was Intel and 3M.

As part of the acquisition, Microsoft also “acquired” multi-touch researcher and PPI founder, Jeff Han, who blew away the TED conference in 2006 with a stunning demo of multi-touch interfaces . (Note that this demo took place almost a year before the first iPhone came on the market.)

The New York-based company is moving its designers to Microsoft’s campus in Silicon Valley, while Han himself is joining the Microsoft mothership in Redmond, Washington.

Does This Make Microsoft a Display Company?

PPI sells hardware. Specifically, multi-touch displays in 27-inch, 55-inch, and 82-inch sizes.

The 82-inch display isn’t cheap, starting at $80,000. The smaller displays are much less expensive, but overall these products are very high-end devices for very deep-pocket customers.

Microsoft says they intend to make this kind of technology much more affordable. But they’re pretty vague about what they mean.

President of the Microsoft Office Division, Kurt DelBene, said that Perceptive Pixel displays “when combined with hardware from our OEMs, will become powerful Windows 8-based PCs.”

Of course, Microsoft has to pay lip service to partners. But it’s also possible that Microsoft will strip PPI for the software and technology, licensing it to Microsoft’s hardware partners and giving the Windows ecosystem a big boost.

The most likely outcome is: all of the above. I think Microsoft will continue selling PPI displays, but also open the APIs and technology to OEM partners building Windows machines.

On the software front, PPI makes an impressive application called Storyboard, which is a kind of multi-touch, multi-user PowerPoint on steroids.

The announcement by Microsoft seemed to focus heavily on the Microsoft Office group, and the benefits thereto. So it’s a safe bet that Storyboard may be integrated with PowerPoint, and that Office apps will get strong multi-touch features.

The company also has APIs that enable software companies to convert existing applications to multi-touch and pressure-sensitive pen input (or both at the same time).

Although Microsoft has developed a lot of multi-touch and gesture-control technology in-house, PPI is also a leader in this field. With that technology come some nice patents, which bolster Microsoft’s kung fu against litigation-happy Apple.

Perceptive Pixel has some great customers, including the Pentagon and many other US government departments, many scientific labs and universities, a lot of media organizations, including all the major US TV networks and many others.

Microsoft Gave Us the Tablet, but Apple Gave Us the Finger

Microsoft was an early proponent of tablets, but using pen rather than finger. Microsoft’s pen-based Tablet PC roundly flopped.

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Tags: Microsoft, Apple, Touchscreens, Multi-touch

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