[Due to the varying sound quality and subject matter of tapes, the information in this transcript may contain inaccuracies.]

BILL GATES: Good morning. It’s been 15 months since we had our last Workstation Leadership forum. And during that time there’s been incredible progress; progress in bringing the PC to a new level, making it an even better tool. Today, we can look at not only the performance, but the way that these PCs are connecting up and becoming tools of collaboration, delivering far more value than ever before.

Here are some of the milestones over the last 15 months. At the last forum we had great software developer support. We talked about the great sales of Windows NT workstation. That’s been a key thing for us, moving the market in a nice evolutionary way from our Windows 98 products on to the Windows NT technology. And there’s really been an acceleration of that.

Last summer we had Synopsis come on, a big milestone, and we started to really get graphics performance that not only match, but in many cases go beyond what expensive workstations have provided.

We’ve had some great customer wins, people like Chrysler back in September. Another big development announcement was Tokia Version 5, which you’re hearing more about today, because that’s gotten very concrete. SGI joining the Intel architecture support group was a great milestone for us. People like General Motors now moving onto Windows. And just the sheer volume of Windows NT at over 28 million as of last March. Unigraphics coming along, and then this June a number of people like Cadence and then a lot of new customers moving over to use these Intel workstations.

So we’ve been very focused, making sure that all the elements come together. Part of our goal today is not only to share our progress, but find out from you what elements are necessary to make it simple for you to have the same architecture for all of your desktops; what software packages, what hardware peripherals, so that great simplification can take place, without any compromise whatsoever.

Now the term I’m using today is "workstation without limits," without any limit in terms of the kind of information you can go and get, no limit in terms of the type of performance you get. Really, this is desktop supercomputing. It’s taking all the information from the enterprise and being able to model it, being able to see it visually and exactly the way that you want to.

And that means you have to be able to reach out to the different business packages, you need to collaborate with all the different kinds of workers, and you need to even have real time meetings -- voice, video, screen sharing across all of these systems. And that’s something that where the uniformity is absolutely critical.

I’ll also talk a little bit about a concept that we have now called "digital dashboard," that is, making it easy to see the things you care about and even be notified of new developments across all the applications, so you have one unified view that can mix together the new mail that’s arriving, your calendar, the quality results that are going on, news over the Internet and make it easy to personalize that so that it fits exactly the job that you’re trying to get done.

When we say supercomputing, we can actually compare the desktop machines we’ve got here with a Cray supercomputer. And so we see that we’ve got the performance of that 1989 Cray. We’ve done better in terms of weight -- (laughter) -- where it’s under 50 pounds. And we’ve done a little better in terms of cost, about 1,000 times better.

So that’s why these rich applications have become so pervasive. And this is a trend that is not slowing down. In fact, you look at the Intel roadmap, we’re actually accelerating the speed at which they bring out faster and faster processors. And so that means all of us in the software world have an incredible opportunity to make software that does an even better job than it did in the past.

And part of this is also comparing with the lower volume of workstations that people like Chronos had, in saying are we really bringing power to the masses in a very, very affordable way. And I think the numbers here are pretty evident that that’s taking place. You can see, for all the elements of this system, the price from a PC supplier, Compaq in this case, that the numbers will come out about the same for all the different PC workstation people, the price is about half what it is in the Sun case.

And I’d love to have anybody look at this, because I was very careful here to make sure it was apples to apples in terms of performance, the memory and a second CPU, and I was surprised that the gap is still that large.

One fascinating thing is that in terms of the graphics here, the card that’s being used in the Compaq system is a 3.4 million triangles per second, versus only 1.4 million. And so that graphics area, which 15 months ago you would have thought of as a weakness, something where you were compromising in moving over to Windows and Intel architecture, today it’s actually a plus, because of the structure of the industry, where with the very high volume those graphics card and chip vendors can afford to put a lot of R&D into doing these great add-on products. And then people like Compaq can take that and package it up in a way that’s compatible with all the software that’s out there. And so the graphics performance has actually been increasing faster than even the CPU performance.

Well, across these various fields, you need the very, very high performance. We have some exciting customer examples. This is one out of the Seismic Data Processing business, where they have an immense amount of data coming in and they have to do very complex analysis, basically to try and find the oil. And so exploration designed software, you used to do this work up on Unix systems, built the software package on Windows, and they’re using a clustered approach, 68 Windows NT machines that work together. And the way they’ve done it is fascinating. If any member of the cluster goes down, it automatically notices and shifts the work over to the other one. You can add more machines to get more power. They’re using these dual CPU boards that are more and more common. And it’s a very inexpensive system. The hardware cost is about $100,000. The software cost is about $100,000.

And so somebody’s switching my slides. (Laughter.) Okay. Nothing like remote control. (Laughter.) There it is, exploration design software.

That's an amazing example from that industry of where the PC power has been tapped into in providing this kind of capability to a customer set that probably wouldn’t have been able to have access to that in the past.

We think that using our own products is a very big way to make sure that we’re getting all the pieces together in the right way. And so both Intel and Microsoft had a big push on to make sure we’re pushing these things to the limit. And a great example of this is what Intel is doing in their design technology group. And so to hear a little bit about the progress they’re making, I’d like to ask Greg Sporakis, who’s the general manager of that group, to come on up and tell us about Intel as a customer, and what progress they’ve made.

BILL GATES: Welcome, Greg.

GREG SPORAKIS: Hi. Glad to be here.

You know, I wanted to talk briefly about the progress that we’ve made, but one of the things I’ve noticed in looking at the other speakers is there’s one area where I don’t think we’re having a lot of convergence of progress, and that is in the area of dress code. It seems like the EDA community continues to work on the no-tie platform. (Laughter.) I happen to think that’s a high-price performance advantage.

But I’m going to go up here and talk, what I’m here to talk about, let me first go into the environment in which we have to operate in for EDA at Intel. We have thousands of users of our design tools, all throughout Intel. We have a wide range of applications that we need to create and support. The applications at Intel run the spectrum from board and system design on through down to the component design, which I think most people are more familiar with at Intel. In addition, the component design runs a spectrum as well, including relatively simple 8 bit all the way up through the high-end microprocessors.

My organization, in particular, develops the applications for those high-end microprocessors, which we believe is one of the most demanding EDA applications that needs to be supported. Towards that end, we have developed and supported over 100 different CAD software tools. And to put this in context, this would probably make us one of the largest EDA vendors on the market, if we were developing the tools for the open market. It means that we have a very large software community inside of the organization.

The infrastructure that we need to support, as you might imagine, has the full spectrum of file servers, application servers, compute servers and so forth, and they’re spread over a wide area. We have worldwide design sites. They’re located in the U.S., Haifa, Israel and a number of other locations. So we have a very complex environment not only in terms of what we develop, but also the many areas that we need to support.

Historically, this has been on workstations, for various reasons, over the years. But today, as I’ll be talking about, we’ve made quite a bit of progress moving off of those workstations, in spite of the fact that we have this very complicated environment.

So what are the advantages that we’re seeing as we make this migration? One of the first ones that we’re seeing is improvement in interoperability and integration. There’s already been a great deal of discussion about the fact that this brings the office productivity apps to the desktop of the engineer, but it’s actually more profound than that. Our ability to integrate those apps actually into our CAD pool has helped a great deal. What a lot of people didn’t realize is that a number of the engineers were already using things like Excel spreadsheets to do analysis of the data that was being created during a design. By moving over to the IA NT platform, we’re actually able to integrate those sorts of capabilities directly into the tools that we developed.

Furthermore, what it’s enabling for us in this area is the ability to take advantage of all the different applications that are available on the open market for IA NT, applications that historically either were limited to select vendors or very expensive in the Unix environment. One such case we had was that we were looking for ways to display and analyze wave forms in one of our tools, and we were able to find one off the shelf and rapidly integrate it into our product that we were developing for a cost that was probably close to 100 times less than it would have cost us if we were developing on the Unix platform.

On a related note, we’ve also seen the superior software development environment. I have a number of developers who have developed in a wide range of environments, including the Unix environment, because that’s historically where the EDA market has been. These developers over the last couple of years have picked up experience and are developing now on the IA NT platform. And what they fairly consistently say is the development environment, the software development environment for IA NT is superior to anything that they’ve worked on in the past. And this is enabling them to come out with our products much more quickly than we had been able to do historically. In fact, the demo that I’ll show later is an example of one we were able to very quickly develop.

The other two areas that we see advantages in are the ones that have already been discussed. One is the superior performance. As I like to say, high-end microprocessor design requires high-end workstations. We wouldn’t be making this move unless that availability of the performance was there. And we are definitely seeing that, and we’re taking advantage of that.

In addition, as Bill pointed out, the price performance advantage that we’re seeing on the workstation is quite substantial, and even engineers without MBA degrees can realize that saving money on the platform is a good deal.

So what is, in fact, the progress that we’ve seen to date? First, over the last three years we’ve deployed close to 2,500 IA NT workstations throughout Intel for use by design teams. And this has saved us somewhere in the neighborhood of $45 million over what it would have cost to buy equivalent workspace workstations. As you can imagine, this is a fairly substantial saving.

In addition, we’ve started utilizing these workstations in some of the products that are under development. One example that I like to point out here is one of the future Pentium 3 processors that’s under design right now, this project has an IA NT workstation on every single desktop of close to over 300 engineers. In addition, we have a compute server forum that’s made available for all of the batch simulation. This has been very successful for the product and represents one of the first examples of taking full advantage of the IA NT platform for some of our development.

In addition, we’re moving a number of our infrastructure tasks over to the IA NT platform. This includes something that we have, which is a bug tracking application. This is a good example of the collaborative type of things that we need to do, in that we keep track of all of the bugs, errata and so forth we capture during our design process, and want to make it available for all of the designers.

We were able to develop this application in under two years, and really on time this year, and the demand has been so great from the various users that we’ve actually had to expedite the deployment to all the projects.

And then finally, as Craig mentioned, all of the PC board design that’s in WPG is now -- the workstation products group -- is now using IA NT platforms. This includes two designs that are already out and then an additional six. You can see that we’ve already made progress in moving this into our development environment.

In the future we’re going to continue to look for opportunities in the batch simulation environment, as well as adding other IA NT based tools, and we’re going to start releasing them selectively to users. In fact, what I want to do is show one of the ones that we are releasing right now to our users. So let me get that demo running.

The demo that I’m going to show is not quite as flashy as airplanes flying over terrain, but it’s actually a very important task for us. At Intel what we do is we make sure that we ship the highest quality product available. In order to do that, we need to be able to do something called pulse simulation. This enables us to simulate ahead of time whether or not we’re covering all the faults that could be incurred in the manufacturing process.

In the bottom what you’ll see coming up on your windows is tracking the progress of the fault grading, or how well that coverage is covered, how well that coverage is achieved through our test.

Historically this sort of application actually required hardware acceleration. In other words, it was not able to be done in software. We’re able to do this in software, in spite of the fact that we’re now having to handle designs that are 10 to 100x larger than anything we’ve dealt with in the past, in spite of the fact as the geometries have gone down, we’re being forced to simulate more and more fault models than we ever had to do in the past.

Further, this particular application we believe is up to eight times faster than anything currently available on the open market, so it’s a good example of us taking advantage of the performance available on the IA NT platform.

And in addition to that, this application was developed in less than a year. This is unprecedented for us, and I would argue it is unprecedented for a lot of EDA tools. This was made possible by the fact that the development environment, under IA NT is very rich, and enabled our designers or developers to very quickly come up with the application.

As you can see, we were able to finish the simulation, which was a block from one of our Pentium 3 processors, in something close to 45 seconds. Historically this sort of thing may have taken hours to run, using other applications, and even involving hardware acceleration.

So I think this represents a good example, even though it might not be as flashy, of moving the supercomputing environment onto the desktop and being able to take advantage of it in the EDA industry. And we are going to be deploying additional products like this in future processors that we have.

Thank you.

(Applause.)

BILL GATES: Thanks, Greg.

One thing that Microsoft is very excited about is the 64 bit advances that Intel is inducting so much in. The transition here will be very different than the transition from, say, 8 bit to 16 bit, or 16 bit to 32 bit. Those were very tough transitions, where you really had to go in and have different versions of your source code, and where a lot of the complexity of the different memory models were exposed to users. Here we’re going from a large linear address base to a very large linear address base. And people will be able to have a single source code for targeting both the 32 bit and the 64 bit platform.

A great example of that is Windows itself. Every night we’re re-compiling the 64 bit version of Windows, running the tests against it and making sure that any new work that we’re doing works as well on the 64 bit platform as it does on the 32 bit platform.

Now we’ve taken all of that 64 bit specific capabilities and just rolled it into our standard software development kit. And so people who got the Windows 2000 beta free software development kit, it had all those 64 bit capabilities, including the compiler that can look and see if you’re using any construct that makes you dependent on having 32 bit pointers, and that creates code that is not portable and so the fact that you can automatically flag that makes it pretty simple to make this transition.

We’re very pleased to get up and running on the Merced simulator, and next fall we’ll achieve the very exciting milestone of actually having the Merced chip and being able to see Windows 2000 running on that.

Our commitment is not just Windows itself. We’ve got our Back Office products like SQL, and, of course, our development tools, the standard releases we’re going to come out with 64 bit. And so our strategy here is very simple: the same day that we release for IA 32 we release for IA 64. And so we keep those source codes in lock-step and make it easy for people who are supporting both of those environments.

We’ve had very good reaction from the software developers, who want to be involved in this early and they’re surprised to see that the actual engineering efforts required by them is less than they would have expected.

Now one key point that we're hitting pretty hard here today is this idea of increasing integration, more data availability out to lots and lots of workers. The world is moving away from paper-based systems, where you're filling out forms and you print out sales reports, to sharing that information electronically, starting with electronic mail but also with rich collaboration tools, not just within the company but with partners as well.

Now, this kind of capability requires application tools; whether it's pivot tables in Excel or special analysis tools, those tools are coming out primarily in the volume environment, in the PC environment. And so people who need high performance, want to be tied in and want to collaborate with all those other people. And so there's a lot going on to get this tighter integration, to get software packages that, to move data around and share things, a lot of that being done using this new XML standard.

We have some initiatives in each of the industry areas where we bring together software developers to talk about what should the standard interchange formats be, and how can we use XML in the best way to get this integration.

Now, one element that is very important to us is allowing for easy deployed systems. This has been a hallmark of many of our successful product efforts. Even as we were pushing Microsoft Office, we made sure we could exchange data with all the products that Office competed with. As we pushed Windows as a network server platform, we made sure it could co-exist with Novell servers. And now, in this workstation world, that means doing a good job of coexisting with Unix systems, making it easy for people as they make the transition to have a mixed environment.

We actually created a product aimed at that in particular, brought about last year, and it's called Windows Services for Unix, sometimes called by its acronym, SFU. And so the first version of this product is out in customers' hands. It addresses things like sharing network volumes, where you have an NFS volume on Unix and you want all the Windows users to be able to get at that. Or, being able to have a common login, so you don't have a Unix password and a Windows password, and those two things are completely separate.

And so we've got customers like Boeing who is using the products, done very well with it, giving us good feedback from where we need to go.

Diebold is a good example of somebody who is using this to get their NFS servers up. This is a product that's very driven by the input we received.

Today, we're actually announcing the version 1 of this product. We have a lot of new things that we've brought in here in terms of simplified administration, making it easier to port over a lot of the scripts, for example Perl scripts that people have in the Unix environment. We were amazed at how Intel and others have built up very large scripts in making those come across in an easier fashion is a clearly stated requirement that we're addressing here with this 2.0 product.

We're going to provide the beta of this product in the next couple of weeks to everybody attending here today. And so we'll send a CD with this out to you, and we're very interested to hear from you, does this address the needs you have as you are in a mixed environment moving towards more and more use of Windows.

Another customer who has done a lot in helping us understand our product priorities is they're making very extensive use of Windows is Xerox. And so I'm very pleased to have here today Corhan Suvinler who is the manager of their engineering systems group, and I look forward to hearing from Corhan how they're using Windows to achieve better time to market.

CORHAN SUVINLER: Thank you, Bill.

BILL GATES: Good morning.

CORHAN SUVINLER: Good morning, everyone.

Speed in bringing new products to market is the key success factor in business today, as you know. In Xerox, we call this "time to market." Our business architecture is built around six key elements: management process, infrastructure, and four core processes: time to market, integrated supply chain, market to collection, and customer services.

Of these, time to market is our end to end product delivery process at Xerox. The group I manage, Engineering Systems, is part of the corporate engineering center, which develops the time to market process, and now oversees it too throughout Xerox.

The time to market program has five chief strategic components, and its core is the time to market process, then the metric breakthrough increment project, three to four projects every year, skills development and technology and information systems.

Here I will summarize one example of our efforts in this area, technology and information systems, moving our manufacturing engineering environment to NT platforms.

Xerox has been transitioning our standard focused desktop to the Microsoft Office application over the last four years. We believe the benefits include that we will have better enterprise integration, due to a single desktop solution. We have lower total cost of ownership, ease of use and better availability of applications.

Today, 95 percent of all users worldwide are using Windows NT, Office 97 or Office 98, and Microsoft Exchange. At the end of this month, which happens to be today, we will have 76,800 NT clients installed in Xerox.

The story for the engineering environment has been quite different. We have stayed with Unix platform much longer due to several reasons. Currently, we have 330 engineering workstations in Xerox, and about that many more in Fuji-Xerox. This number is increasing very rapidly due to two reasons. One of them is aggressive hiring of engineers, due to our time to market needs; and the second one is deployment of new engineering workstations to the existing engineering community to expand the use of engineering analysis. Again, this is to improve time to market.

As we mentioned in the Workstation Leadership Forum a year ago, we have done a pretty extensive NT pilot in Xerox. We want to give you some of our findings. We worked very closely with Microsoft, Intel, Compaq, HPRC and EDS. HPRC supplies our CAD system, and EDS is in charge of our network and systems support. The architecture we came up with is somehow similar to the previous architecture, in that we have data and application servers. In our environment, besides our CAD system ideas, we have mechanical working models and several engineering analysis and simulation tools.

At the end of the pilot, the suggested architecture was compliance with Xerox corporate architecture. Of course, this has the advantage of easier enterprise integration, but also simpler systems support. We found out that the performance of all our applications, except one, was similar or better on a comparable NT environment. We have heard of similar results from previous studies, but it was good to see this ourselves.

We found out that a major application related issue was that one of our applications for one of our applications, data sharing in with mixed environment of NT and Unix was too cumbersome. This prohibited co-design in a mixed environment during migration. This vendor right now is working hard to fix this. In fact, in the new release, the steps needed for data transfers between the two environments is going to be eliminated.

The other main issue was the knowledge of NT for people who support the engineers. We have very good knowledge in the corporation, but the group under EDS that supports the engineering community is now going through some training on NT and related technology as well as they are hiring some new experts.

Finally, this year we started deploying NT workstations to our design and manufacturing engineers.

Next, I am going to show you a very simple demo of how we use this application on this simple desktop. The product you see is a very high speed digital color printer. It has about 10,000 parts, 4,000 unique parts. Because of proprietary design and time, and we are showing only a few of the colors and the frame here.

What we are doing is analyzing the new color you see on the lower left for impact loading. In Xerox we have several tests for our colors to simulate real life situations -- someone leaning on a copier or someone possibly mad at the copier, kicking the copier -- (laughter) -- this is in fact that test. The test is dropping half a kilogram of a steel ball from the height of 1.3 meters. Here we are preparing the mesh, and the bonding conditions. Now we are launching the Abacus to solve this analysis. Analysis, as you know, is a highly powerful linear and non-linear analysis application. And then the results are first processed and displayed in ideas, as you will see in a minute.

What you are seeing here next is the deflection of the colors due to this impact load. Here the displacement is highly exaggerated due to better visualization. The actual scale appears on the right for displacement. Of course, we can have the test disposition similarly and check whether this part satisfies these tests.

As you can imagine, using analysis tools like this increase time to market drastically.

Next, I'm going to show you again a simple example of the use of this mock-up from EAI. As you know, this mock-up is visualization and mutual mock-up application for very large assemblies. We use this mock-up in many different ways. In this case, the design engineer we call "integrator" is using it for interference checking, with this front assembly, and this mock-up is finding that there is some interference with that small light part, is putting text on this 2D drawing, saying that the engineer responsible for this design should look this part one more time. And then he is including this in an e-mail using Microsoft Exchange and sending it to the design engineer responsible for this part.

Here, the real message is we have all our CAD CE applications as well as our Office desktop applications in this single environment for our engineers. We definitely would like to see more integration between different applications, but this is still better than what we had before.

Our future plans, we will work with our partners closely for a smooth transition from the current environment to the NT platform. We believe this is important for our strategic time to market goals. We have put together plans for deploying to the existing engineers and the new hires.

And finally, we agree that closer relationships, partnerships between the CAD providers and the application providers, Microsoft, Intel, workstation PC vendors, graphics card vendors, is going to increase this integration and also optimize the environment for better performance. And for that reason, I believe forums like this are important and useful for companies like Xerox.

Thank you.

(Applause.)

BILL GATES: Well a major milestone for all Windows users will be the shipment of Windows 2000 later this year. On the desktop we call it Windows 2000 Professional. And, a number of the advanced capabilities here will help in the workstation environment. It's got support for mobile computer, which means you can have these high-end applications and take your workstations home or to customer sites. It's got easy administration so you're deploying new software as simply an administrator changing policy entries in the active directory. It's got the ability to mirror the information back up on a server so that the information is always available on backup without overloading the network, and you can even go to another workstation and log in and have access to your information.

And so the advances there are important, and, of course, the working with the developers of all these applications to make sure they not only work well with Windows 2000, but they take advantage of some of those new capabilities.

One of the things that we are pointing out that this platform makes easy is this digital dashboard, allowing all your information to be on a screen. Engineers, of course, were spending time in collaboration and in business type software, and so having deep integration between these things is pretty valuable.

To understand this, let me just show you an example of what an engineer's digital dashboard might look like, combining a project status calendar, in-depth folders about particular activities, and so making it easy to navigate by taking something like Outlook and its customization capabilities and putting in links to the different things that you're interested in.

Another thing we think is pretty exciting is upping the kind of communications you do through the workstation. For example, British Petroleum has been able to use NetMeeting, which is an on-line video conferencing capability that's built into Windows to connect up to people on drilling rigs and solve problems more quickly, saving lots of money.

At Microsoft, we have lots of meetings, and we've gone through and looked at all of them and said, "Are there some of these that can be done in a better way?" And a good example is the group that built our Exchange products, they have this weekly review of where things are. And it used to involve about 50 people all sitting in a room taking lots of notes. But by putting in a wireless network, by putting that meeting on NetMeeting, they've not changed it completely. People come to the meeting with their portable computers, take their notes there. They can dive down into more detailed information during the meeting instead of trying to read the small print on a slide that might be displayed.

Now, instead of having 40 or 50 people in the room, there's only 15 or 20, because people who are just casually interested can watch on the NetMeeting, and if you want to come in for a particular part of the meeting, you simply monitor the progress they're making and then show up for your part of that meeting, and then go back to work.

So the number of man-hours required by the meeting has been cut in half, and yet the effectiveness has been improved pretty substantially. And so, these kinds of improvements in sharing information, collaborating, literally reducing meeting times, all are coming together around the PC with the rich software that's available to us.

I think one of the best examples I've seen of taking this concept of integration to a new level is what we are seeing from Genidex. And so I am very excited to have Hal, Alice and Grant Bergatini here to show us a piece of software they are developing.

Good morning, Hal.

HAL BERGATINI: Thank you. (Applause.) Thanks.

Well, design technology, growing at the rate of Moore's law, is pretty exciting. But the design complexity grows even more rapidly. The designers today using this technology have to use bigger teams, they have to use more applications, and they have to deal with organizations all over the world. We've been able to at Genidex take the Microsoft platform and to be able to extend it to this environment and really provide the digital dashboard you've been talking about.

We'd like to give you a chance to show you that.

BILL GATES: Super.

HAL BERGATINI: Grant Bergatini is responsible for developing software at Genidex, and he's going to use this Compaq computer to take us through a quick design scenario of how one of our customers, a designer, would be using this software.

As we begin, Grant is using Internet Explorer to visit his favorite design Web site. And he gets an urgent message from his manager. It's really a message from Microsoft Project, through Exchange, and it's telling Grant that he needs to add a decryption unit to integrate its circuit that his team is designing for a DVD. Grant sends a message back accepting the task, and returns to Microsoft Internet Explorer.

With that message sent back, Grant is able to go from the Web page, navigate using the tree view on the left, right directly to the design.

Now it shows up as a schematic diagram with a part that Grant has to edit. And in the pane below, there are various associated documents. Behind one of the tabs, there are a set of different documents that help explain what this design does. One of those documents is a Visio diagram that illustrates how the integrated circuit works with the rest of the components of the DVD. We can put any other kind of document there. It could be the specification requirements, even a video clip or an audio clip.

Now behind one of the other tabs are the tasks, and these tasks are directly connected to Outlook. So Grant's going to take the task given by his manager and associate it here. This feature helps Grant take all the tasks his managers give him and put it with the right design that he's working on.

Well, now that the task is there, Grant can go ahead now, and proceed with adding the decryption unit to the design.

GRANT BERGATINI: Well, Bill, my task is to add the decryption units to this design. Fortunately, the decryption units have already been acquired from a commercial supplier and have been added to my parts list, so I can simply select it, grab it, drag it, and drop it into the design. As I do this, all the associated documentation is being added into my design hierarchy.

The next step is when we start connecting this component into my design. As I do this, I'm creating a model that "Analysis Applications" can start to examine as I work live on the design data.

Now in the interest of time, I'm just going to add one wire, and we'll consider this task to be complete. So I'll save the design, I'll return to the Documents path, and I'll bring up Project Schedule, so I can see what my next task might be.

And what I see is that my next task is to update the documentation to reflect the change that I just made. So I'll open up the functional specification, which in this case is a Word document.

HAL BERGATINI: Now there we're using Internet Explorer as our digital dashboard. So Grant could actually drop down on his Favorites list, jump over to a Web site, and then use the back arrow to navigate right back to the documentation.

GRANT BERGATINI: Now I have the "Functional Specification" open. The diagram that I was working on has been linked into this document as a diagram, and you can see that the change that I made has already been updated, saving me the time of updating all the graphics in my diagram.

HAL BERGATINI: Now Grant has finished this project, so he's now able to go back to the Taskbar, bring up the task in his manager, send a message back to him, saying it's 100 percent complete.

Now, while this is going on, Grant is working in a team environment, so data management is really important. And through this process, Grant has had this part of the design checked out, and that's illustrated by these little checkmarks in the bottom of each of the icons.

It's now time for Grant to check this back into the vault, and that's just a menu and a dialogue box away. We've seamlessly integrated with Microsoft Visual SourceSafe to provide this functionality in this environment.

Now, with this task all complete, we'll see that the little checkmarks turn into Xs. It's now locked down. The design task is complete. The only thing left for Grant to do is set up a NetMeeting to basically take this design, pass it off to the customer, share the desktop and step through all the information, and complete the exchange. And that's really the end of our demo.

BILL GATES: That's integrated enough. I couldn't even tell when your software was running versus when Microsoft software was running.

HAL BERGATINI: Well, that's really the plan. During this demonstration, Grant went through nine different applications. And during that whole time, Grant could focus on the design, never worried about the application; they came and went as needed.

And this environment is also open. We're able to share our extensions to NT to Internet Explorer, so that other customers, vendors, can use the same extensions we've done to seamlessly integrate their applications. We think this is a really good example about how NT can be extended to serve a very specialized market, and how Internet Explorer can be used as a "digital dashboard" to provide this kind of collaborative environment that designers really need.

BILL GATES: When is the software going to be out and available?

HAL BERGATINI: Well, we'll be Beta testing very shortly, and we'll be shipping by the end of the year.

BILL GATES: Well, that's fantastic. That will be a super thing to get out and market. Good, thanks very much. Thanks for coming.

(Applause.)

BILL GATES: So, there you've seen some good examples of why we think about the work we're doing as providing work stations without limits: supercomputing capability, a rich enterprise integration, a new way of meeting and collaborating, and being able to see all your information through a digital dashboard.

I think this points to some big opportunities for everybody here. The innovation in the PC space, with the thousand companies that do the components, peripherals, the systems -- they all come together to create really quite an amazing tool. And that innovation is faster than ever.

We're really talking about new ways of working. We're not just taking the way that work was done on the older work stations and trying to duplicate that at lower cost. By bringing the Internet in, by bringing the productivity tools in, by hooking people together, this is about far more productivity for engineers and everybody else.

And I hope you get a clear sense that with all the progress we've made, we're still at the beginning of this revolution. Thank you.

(Applause.)