Microsoft's Ballmer: We 'missed' on mobile

Microsoft chief executive Steve Ballmer said in a speech Monday that Microsoft was late to the mobile war but is focused on becoming a stronger competitor this year.

"We missed a release cycle with Windows Mobile 7," Ballmer admitted.

Ballmer predicted workers would soon be asking their IT departments for Microsoft phones.

Business partners are already telling him, "'Show us what you're going to do with phones,'" he said. "And we are hell-bent and determined to drive [phone] volume with IT and with the end consumer."

Ballmer's remarks come only weeks after Microsoft's Kin phone was pulled from shelves after selling fewer than 10,000 devices.

Speaking to a packed crowd in Washington's Verizon Center on Monday, Ballmer's main message was clear: The future is in the cloud, and Microsoft's cloud services are more secure and more reliable than any other company's.

"When you want to help people be productive," he said. "We're way ahead, and we can win."

A live band, complete with smoke and stadium lighting, preceded Ballmer's speech. An emcee called on the crowd to chant, "Oh cloud, oh cloud, oh cloud, oh cloud."

"We have been chanting about 'oh cloud' for about four years," Ballmer said when he ran onstage. "We're trying to improve, through the cloud, people's ability to collaborate outside their organization."

Ballmer homed in on "operational excellence" as Microsoft's selling point, pointing to the "reliability, security and privacy" of the company's cloud services.

"When customers entrust more of their data and operations to us, the need is to do better," he said.

Ballmer also touted the company's growth in the search market, though Microsoft's search engine Bing is still severely outpaced by Google, which captures upward of 70 percent of the market.

"We've picked up about three share points as the Bing technology gets better, from about 8.5 to 11.5 percent market share," Ballmer said.

He added that Bing is improving as it gets more users.

"Once you have millions of people … trying to figure things out, trying to make decisions, mining data, you learn a lot about the technology," he said. "That lets you statistically understand what users are interested in doing."