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Ballmer structured the keynote around the theme of Microsoft moving to "the cloud" -- that is, "cloud computing", in which programs live on Web servers accessible from any device with an Internet connection instead of being confined to individual computers.

Many of the most widely used implementations of cloud computing, however, come from Google and other competitors. Microsoft, meanwhile, must convince developers and resellers who have spent decades investing in the Redmond, Wash., company's PC-centric software to redirect their attention.

To win that argument, Ballmer described "the cloud" as an anthropomorphized being, possessed of its own logic and momentum in a way that almost requires writing that phrase in initial capital letters: "The Cloud." (Or maybe small caps would be more appropriate: The Cloud.) Slides accompanying his talk spelled out a message of Do What the Cloud Wants:

"The Cloud Creates New Opportunities And New Responsibilities."

"The Cloud Learns and Helps You Learn, Decide & Take Action."

"The Cloud Wants Smarter Devices."

And so on.

It's hard to disagree with that basic analysis; the lure of anywhere access online has led Microsoft to start moving its flagship Office suite to the Web, after years of ceding that market to Web-only competitors such as Google Docs.

But while Microsoft can boast of some impressive numbers for its cloud-computing efforts, it's also at a serious disadvantage, especially outside of corporate markets.

Its Web properties badly trail those of others -- during the keynote, Ballmer noted that its Bing search engine has gone from 8.5 to 11.5 percent of that market. In some key markets, Microsoft is a nonfactor: When Ballmer discussed how "The Cloud Enhances Your Social & Professional Interactions," he cited such third-party social-media sites as Facebook and Twitter.

A cloud-computing strategy also requires a modern Web browser that can run anybody's Web application. The current release of Microsoft's Internet Explorer does not qualify as such -- undercutting Ballmer's claim that "we very much embrace" Web standards -- so he had to talk about its upcoming Internet Explorer 9 instead.

And as Web access continues to expand beyond desktops and laptops, Microsoft's cloud ambitions require a viable presence on smaller, more mobile devices. But the company's efforts in those categories are a mess.

Ballmer nodded to that reality when discussing smartphones, saying "We missed a generation with Windows Mobile" (though he didn't mention Microsoft's quickly-killed Kin project). He pointed to the company's upcoming Windows Phone 7 software as cause for hope -- but while Microsoft continues to work on getting that ready for a launch later this year, Apple's iPhone and Google's Android are busy eating its lunch.

Microsoft looks even worse in tablet computing, now redefined by Apple's iPad. Where Apple's device succeeds by not trying to act like a laptop without a keyboard, Microsoft still wants to put Windows in a smaller box -- the same strategy that flopped four years ago as the "Ultra Mobile PC."

Ballmer largely repeated the pitch he made at January's Consumer Electronics Show for "slate" devices running its Windows 7 operating system. A slide listed 21 companies lined up to make these things -- including Hewlett-Packard, notwithstanding reports that HP is ditching its slate plans, possibly in favor of a tablet running its new subsidiary Palm's webOS software.

Ballmer closed the keynote by all but commanding attendees to buy into its cloud-computing vision -- "If you don't want to move to the cloud, we're not your folks" -- before pledging that "the next 12 months will be some of our most exciting, phenomenal and incredible times together."

But just before then, while talking up recent progress, he used what may be an unintentionally revealing metaphor: "The wheels have been spinning very well for us and our partners."