For Mik Kersten, it all started when he saw Maria Klawe speak at the University of British Columbia. It was the mid-1990s, and Klawe, a distinguished mathematician and computer scientist—now the president of Harvey Mudd College and recently appointed to Microsoft’s board of directors—was giving a lecture to students and faculty. “She talked about her hippie days traveling in India, and it convinced me to switch to computer science,” Kersten says.

Kersten was an undergrad at UBC studying anthropology. Today, he is the co-founder and CEO of Tasktop Technologies, a Vancouver, BC-based startup that is working to reinvent user interfaces for software developers and other knowledge workers so they can be much more productive. It is one of those quiet Northwest success stories you probably haven’t heard much about yet, but you will—Tasktop is profitable, and has recently signed a number of important deals with the likes of IBM and Microsoft.

The company’s basic idea is to organize work around tasks, instead of files, folders, or Web pages. Kersten’s “task-focused interface” builds tools and information around the specific task you are trying to accomplish—writing code to import digital media into a library, say, or analyzing trends in a database. Tasktop’s software automatically gathers screenshots, notes, e-mails, and other information related to the task at hand and puts it on your desktop in a single handy spot for reference. If you come back to the task an hour later, or a week later, your desktop is returned to where you left off.

It’s a far cry from the way most people work on tasks today, using tools that are glorified Windows Explorer or Mac Finder applications, or Outlook or Google search tools that make you scroll through tons of results, Kersten says. As a software engineer himself, he had felt quite a bit of personal pain. “I was getting bad RSI [repetitive strain injury] in my forearms,” he says. “I was spending more time looking for the information I needed to write code than actual coding.”

Kersten’s early career path took him to Palo Alto Research Center (formerly Xerox PARC) in Silicon Valley, where he worked on user interfaces until 2003. There, he was exposed to a technology called “degree of interest trees.” This is a type of interface that lets you navigate large, branching structures of information. The amount of detail displayed is based on your level of interest in each item, so you don’t get swamped with lots of information about low-priority matters. As Kersten explains, this “makes it easier for programmers to work with very complex systems”—like having to refer to millions of lines of code, or search through 100,000 files. “Programmers get completely overloaded with information,” he says. “It’s extremely difficult to find what they’re looking for.”

After a six-month stint at Bellevue, WA-based Intentional Software (billionaire Charles Simonyi’s company), Kersten decided to quit industry to do fundamental research on how to improve …Next Page »

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It’s been a very busy week for news in the mobile industry. First, Amazon (NASDAQ: AMZN) rolled out a one-click mobile payments service that promises to shake up the world of mobile-app developers and distributors. Then it seems like all hell broke loose, courtesy of the massive CTIA wireless expo going on in San Diego through this Friday.

Here’s a quick summary of what’s happening in mobile-device interfaces, iPhone apps, and other mobile news from the Northwest:

—In the area of speech interfaces, Seattle-based TravellingWave announced today at CTIA its “voice-powered text prediction” application for mobile phones. The idea is to combine keyboard-based text input prediction with speech recognition so you don’t need to press as many buttons, while keeping the text-entry process accurate and simple to use. TravellingWave was founded in 2004 and is backed by its founder, angel investors, and grants from the National Science Foundation.

—Not to be outdone, Microsoft’s Bing and Sprint said today that the upcoming Samsung Intrepid smartphone (available Oct. 11), which runs on Windows Mobile, will incorporate Microsoft’s Tellme software to enable consumers to use their voice to dial contacts, compose text messages, and search the Web for business listings, cafes, weather and traffic reports, maps, and directions. It’s the first mobile device to use Tellme, as far as I can tell.

—Seattle-area startup Glympse, which focuses on mobile location sharing, announced yesterday it has been selected as a “showcase” application within Windows Marketplace for Mobile, Microsoft’s recently announced mobile app store. So Glympse is now available on Windows phones with GPS, and is in private beta trials on the iPhone. Back in May, Glympse first launched its service on T-Mobile phones with Google’s Android operating system, and CEO Bryan Trussel talked with me about the company’s strategy.

—Who knew that developers in Portland, OR, had put out so many iPhone apps? Silicon Florist reported yesterday that the region is responsible for making more than 40 apps in the iTunes store, including prominent ones from Starbucks, Barnes & Noble, Whole Foods, and Zipcar. The list also includes Stanza, the hit e-book app developed by Lexcycle, which was co-founded by Portland resident Marc Prud’hommeaux. Lexcycle has since been absorbed into Amazon. (Don’t mess with Seattle.)

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The digital photo frame is one of those consumer-electronics categories that seems perpetually poised to take off, but never quite gets airborne. I bought a Ceiva frame for my grandmother back in 2001—it plugged into a phone line and downloaded new pictures from the Ceiva website every night at 3 a.m. Today, things are pretty much the same. The displays of the latest models are brighter and crisper, and most come with memory-card slots instead of phone cords. But there has been surprisingly little innovation around the basic idea of the digital frame. They’re still just passive devices that sit on your desk or bookcase, cycling through the same pictures over and over until someone updates the memory card.

Isabella Products in Concord, MA, is trying to change that. On October 30, it will launch Vizit, which masquerades as a digital photo frame but is actually a sophisticated, two-way photo management device connected to a nationwide cellular data network. The product will have a price tag commensurate with its capabilities—in the $250 to $280 range, plus a monthly subscription fee. I know a lot of early adopters who won’t balk at that price, considering that the Vizit—the brainchild of local venture capitalist and Motorola veteran Matthew Growney—raises the bar for the whole category of digital frames, just as the iPhone did in the mobile world.

The Vizit is attractive, but much more importantly, it’s smart and it’s connected. “The beauty is not so much in the physical design, although our guys have come from places where design matters, like Motorola and Bose and Nike and Facebook,” says Growney. “To us, it’s about the connectedness of the device…it’s about managing the sharing experience.”

On the hardware side, Vizit has an impressively large screen, measuring 10.4 inches diagonally, which is 2.4 inches more than Ceiva’s largest frame. It has HD-quality resolution of 800 pixels by 600 pixels, compared to Ceiva’s 640 by 480.

But it’s the interactivity packed into the screen that really sets the device apart. Trust me, I’ve seen lots of these devices, and the Vizit—which I got to play with last week during a visit to Isabella’s office inside Concord’s historic old Damon Mill building—is unique.

For one thing, it’s a touchscreen device, which means there aren’t any cryptic buttons on the side or the back of the frame: all the controls are right on the display. For another, it’s got an elegant user interface that makes it easy to do things like rotating photos, choosing different slide show transition effects, or selecting which photo album you want to view.

It’s also got the built-in cellular modem, which means it can download photos from the Internet without having to be plugged into a phone line or an Ethernet cable or integrated into a home Wi-Fi network. And the modem doesn’t just grab photos from the network: it can also …Next Page »

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When you’ve been at Microsoft for 17 years, you’ve seen a few things. This morning, Craig Mundie, Microsoft’s chief research and strategy officer, shared some of his hard-earned wisdom in a keynote talk at company headquarters in Redmond, WA—helping to kick off Microsoft Research’s 10th annual faculty summit.

Mundie outlined his broad thoughts on the future of computing and Microsoft’s role in it—and went into pretty good depth in spots. Nothing too earth-shattering, but it was cool to hear the technologist discuss the roadmap of where his company may be headed with more of a research and innovation hat on, and not much marketing slickness. The backdrop of his talk was that computing devices are becoming more and more pervasive (at least in wealthy countries), so what are the emerging opportunities? “Computing everywhere will be something we take for granted,” Mundie said. “But it was not common knowledge as little as 15 years ago.”

“Today, computers work at your command,” Mundie continued. His vision, he said, is that they will transition to “working on your behalf.”

Here are my top five takeaways from his talk:

1. It’s all about the natural user interface.

Today’s devices are able to understand voice, handwriting, and touch commands better than ever before, but nobody has really put it all together yet. “All the things we talk about as natural user interfaces have been largely used one at a time as enhancements to [graphical user interfaces],” Mundie said. Gesture recognition, expressive responses, immersive 3-D virtual environments, and understanding of context—these advances in computing algorithms will lead to software that is “better at anticipating what you might want.” (Mundie said that Nathan Myhrvold, who hired him, pointed out that early movie cameras were used to film plays before people experimented with them to create new kinds of film experiences. In the same way, better user interfaces will lead to new ideas about how to use software, Mundie implied.)

2. It’s time for the digital assistant—but fear not, real assistants.

Mundie showed a demo of Microsoft researcher Eric Horvitz talking to a “robotic receptionist” (on a screen) to schedule a meeting. The software used machine vision to track Horvitz’s movements, gaze, and orientation to the screen, speech recognition to understand what he was saying, and speech synthesis to communicate back to him—all in real time. Mundie admitted each element was still rough, but …Next Page »

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Dan Weld spends a lot of time thinking about the Web and how to get the best information out of it. Weld is a professor of computer science and engineering at the University of Washington and a serial entrepreneur, having co-founded Netbot, AdRelevance, and Nimble Technology. He is also a venture partner with Seattle-based Madrona Venture Group. Some of his research projects include customizable software interfaces and ways to improve information finding on Wikipedia. He is an expert in Web search, information extraction, and adaptive user interfaces, so he seemed like the perfect person to ask: what is the big deal with Microsoft’s Bing, anyway?

In a recent interview, Weld talked about the improvements Bing has made over Google and other current search engines (only slight), the future of Web search, and a hint at a project he is working on that he thinks could change the way we find information online.

The following is an edited version of our conversation.

Xconomy: Let’s start with your general impressions of Bing.

Dan Weld: I think it’s a nice, if small, advance. Some of the things they’ve done in this relaunch are primarily architectural and will support their plans for the future. In terms of what is actually available right now, the biggest change is integrating vertical search in a uniform way.

X: What does that mean?

DW: When you think of search, everyone thinks about Google, and maybe Yahoo, but there are many other kinds of search, like people searches (you can think about Facebook as a people search), travel search (Kayak and Expedia), health information sites. You can think about Wikipedia as providing a search for encyclopedic information. Shopping searches—Amazon is great in part because it makes it easy to find so much information about the products, and reviews of products. All of these are examples of vertical search experiences. Instead of having wide coverage, you have a better experience within a narrow range.

Bing has tried to marry those things into an integrated wide search experience. All of the engines have been doing this. If you do a search on Google for a movie, you might see information about show times and trailers at the top, for example. Bing has gone further in some directions than people have gone before, in this aspect. If you look at their tabbed pane, it lets you look at different kinds of information right there.

X: But doesn’t Google do that too?

DW: All the engines are trying to do it, but the way Microsoft has done it with Bing is somewhat better than what Google has done. With the shopping tab, you get a faceted interface, meaning you can narrow your search using categorical information, restricting yourself to a particular brand or price range. Those facets are specific to the object you’re searching.

X: So if this is just a small change, what kinds of big changes can we expect to see in the future?

DW: Lots of people are happy with search today, but that’s because they set their sights too low. I think search is going to change enormously in the future, and I think it’s going to do so by …Next Page »

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Seattle-area software startups AdReady, Swype, and TeachStreet won “best in show” at the Washington Technology Industry Association’s Fast Pitch Forum and Tech Showcase yesterday. The winners, selected from 23 presenting companies, were voted on by the audience. The prizes include tickets to Safeco Field.

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It is high season for tech gatherings in Seattle. The next couple of weeks will feature a dizzying array of events chock-full of compelling computing content, not to mention top-tier networking. How is a busy entrepreneur, researcher, or investor to choose which ones to attend? Let Xconomy be your guide…

—This Wednesday, April 22 (yes, tomorrow), the Washington Technology Industry Association is putting on a feast for all of you interested in the future of human-computer interfaces. Bill Bryant of Draper Fisher Jurvetson is moderating an all-star panel of interface experts: Cliff Kushler of Tegic and Swype (text-input software for mobile devices); James Landay from the University of Washington’s computer science and engineering department (activity sensing, user behaviors); Bert Keely of Microsoft (Windows Pen & Touch technologies); and Jeff Pobst of Hidden Path (gaming interfaces).

Bryant says, “The kind of topics we’ll be discussing are at the heart of what user-centered computing will look like in the coming years and decades.” He points out that when you think about everything from the Wii to Windows 7 to Web browsers (and throw in the iPhone and GPS devices for good measure), “the entire history of computing can be summarized as ‘advances in user interfaces.’” Now there’s food for thought.

—How far along is Windows Azure? Microsoft’s cloud computing service was announced last fall, and is seen as a competitor to Amazon Web Services, Google’s App Engine, and other offerings like VMware’s “virtual data center” operating system. But who is actually using it yet, how does it work, and what is Microsoft’s cloud strategy? On April 30, Microsoft is hosting an event organized by the WTIA where it will answer those questions, and more. Doug Hauger, Microsoft’s general manager of cloud infrastructure services, will give an overview of Azure and Microsoft’s view of cloud computing software and services.

A bonus speaker will be Ian Knox, director of product management at Skytap, a Seattle-based cloud computing and virtual lab startup. Knox will talk about using cloud computing for Windows applications and lowering IT lab costs, among other things. All in all, it’s essential stuff for anyone interested in shaping the future of the cloud.

—On May 1, the Technology Alliance is hosting its annual State of Technology luncheon. This year’s theme is “framing the future.” The guest of honor is Ray Ozzie, Microsoft’s chief software architect, who will have a keynote conversation with the UW’s Ed Lazowska. (We’ll see if he puts Ozzie on the spot about Windows Azure or Microsoft Live Labs.) Throw in an address by Gov. Chris Gregoire, a benchmarking presentation by Technology Alliance board chair Jeremy Jaech (of Verdiem), and recognition of the Alliance of Angels’ 2009 company of the year, and you have the technology event of the season, not to be missed.

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After a flurry of Northwest deals the previous week, the past seven days have been fairly quiet, with some activity in security software, aviation, and biotech.

—Kent, WA-based Naverus, a company that makes advanced navigation systems for airlines and air traffic managers, raised $4 million from existing investors Foundation Capital and East Peak Partners. I got the story behind the company and its efforts to make flight paths greener and more efficient, from chief marketing officer Dottie Hall (a very early Microsoft employee from the late 1970s).

—Washington state’s venture capital numbers for the first quarter of 2009 came in, and not surprisingly, they’re pretty grim. But they’re certainly not without hope, as VCs from OVP Venture Partners, Madrona Venture Group, and Buerk Dale Victor told me in an interview. We also tallied the state’s top five venture deals of the first quarter, which span the areas of biotech, lasers, user interfaces, and cloud computing software.

—Seattle-based Haute Secure, a maker of anti-malware security software, has been acquired by TRUSTe, an online privacy firm in San Francisco. Financial terms were not disclosed. Haute Secure was funded by Baseline Ventures and Sherpalo Ventures.

—GridNetworks, an online video startup in Seattle, is merging with Global Media Services, a New York firm. No financial terms were given. The combined company will provide streaming video and other media services for personal computers, mobile devices, and TV. GridNetworks was founded in 2005, and was backed by Comcast, Cisco, and Panorama Capital.

—Portland, OR-based SignaCert, an IT security and management software startup, raised $8.8 million in Series B funding. The round was led by existing investors including DCM, Intel Capital, and SmartForest Ventures. In-Q-Tel and other strategic investors also participated.

—Luke reported that BiPar Sciences, a Brisbane, CA-based developer of cancer drugs, is being acquired by Paris, France-based Sanofi-Aventis in a deal that could be worth up to $500 million if the company’s lead drug candidate reaches certain milestones. Paul Allen’s Vulcan Capital led a $13 million Series A funding round in BiPar in 2004.

—Lastly, we ran a two-part feature story on how some of Seattle’s most prominent venture dealmakers are approaching the University of Washington’s tech transfer office, and its researchers, in search of the next great UW spinout. The consensus seems to be that the UW has long been a world leader in commercializing technologies, and now the intensity has been jacked up an extra notch.

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A few local tech companies have still been able to raise significant new funding rounds in a very tough climate. The latest is Seattle-based Adapx, which is announcing today it has raised a $9 million Series B round, led by new investor UV Partners in Salt Lake City, UT. Existing investors OVP Venture Partners, based in Kirkland, WA, and Paladin Capital Group in Washington, DC, also participated in the round, which closed in March.

Adapx (pronounced “adapts”) makes digital pen technology that allows workers in the field to take handwritten notes and efficiently upload them to a computer. The technology allows workers to use pen and paper to collect data, mark up charts and maps, and draw on design diagrams, and then digitize their pen strokes by docking the pen to their PC. That way, they can automatically integrate the info with mainstream software applications like Microsoft Office, Excel, Autodesk (for engineering design), and ESRI (mapping).

“Investors and customers really get our story. Adapx has exceeded our expectations for adoption,” says CEO Ken Schneider. The company, founded in 1999, counts more than 500 companies and government organizations as customers, including the U.S. Department of Defense, NASA, the Port of Seattle, Holland America Line, and various public works agencies and construction firms.

OK, but digital pen technology has been around for many years, and has never really taken off. So what’s special about Adapx? From what I can tell, two things. First of all, the technology really seems to work. In the past, everyone from Apple to Logitech to Microsoft has developed digital pens to capture handwriting and integrate it with digital files. These systems have tended to be clunky and unreliable, or just too much of a pain for mainstream customers to get started on. Some have required special paper, for instance.

The Adapx version, which uses technology from the Swedish firm Anoto, requires no special paper—though it does require you to print out the form (a spreadsheet or chart, say) you’ll write on, using software that prints a special watermark to help the pen keep track of where on the page you’re writing. The pen, which is the size of a magic marker and writes regular ink, contains a tiny scanner that captures your handwriting and stores it until you dock the pen with your PC. “That allows the paper to become the device,” says Schneider.

Which then leads to the second main advantage of Adapx. The handwriting is uploaded, recognized as text, and integrated into an Excel form or Office document automatically. The point here is that …Next Page »

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I spent a couple of days this week at CHI, the big annual meeting of the Association for Computing Machinery’s Special Interest Group on Computer-Human Interaction (ACM SIGCHI). It was the first time since 1994 that the conference—the main international gathering for scholars and practitioners in user interface design—has come to Boston. But it wasn’t the first time that a single company, namely Microsoft, has dominated the proceedings. Matching statistics from other recent CHI meetings, authors from Microsoft Research supplied nearly one out of eight papers presented at the conference, and researchers Ken Hinckley and Meredith Ringel Morris from MSR’s Adaptive Systems and Interaction Group in Redmond were co-chairs of the technical program.

I’m a sucker for this stuff, so I thought almost all of Microsoft’s 25 CHI papers were interesting. But two of the talks in particular, presented back-to-back on the closing day of the conference, contained enticing new ideas about how we might use computing devices in the future. One of them was Hinckley’s own paper on Codex, a prototype dual-screen computer system. The other was a paper by Patrick Baudisch on “back-of-device” interfaces, an intriguing alternative to today’s touch-screen-based devices.

Baudisch, a German native, is a former Xerox PARC researcher who joined Microsoft in 2002 and recently accepted a joint position at the Hasso Plattner Institute at the University of Potsdam in Germany. One of the questions he’s been studying over the past few years is whether it’s feasible to move the main touch interface for small mobile devices (think phones, mini-tablet computers, iPods, Zunes, and the like) from the front—where your fingers occlude your view of the screen—to the back.

After all, the smaller devices get, the less screen real estate they’ll offer, and the larger the fraction of the screen that’s covered up by your finger when you try to manipulate it. “The scientific term for this is the fat finger problem,” Baudisch deadpanned during his talk.

If the touch-sensitive surface on a mobile device were on the back instead, gestures like pointing, tapping, and selecting wouldn’t get in the way of the screen. At least, that’s the idea. But that creates a new challenge—seeing where your finger is going. So Baudisch’s team has been experimenting with a variety of approaches, including using transparent screens (which, unfortunately, don’t leave room for the electronic guts of most devices) and attaching a boom with a camera to a device’s backside (which is predictably clunky).

Baudisch’s newest prototype, and the one he described yesterday, is called nanoTouch. It’s a squarish little gadget resembling an iPod nano, with a 2.4-inch screen that dominates the front and a capacative trackpad similar to the mousepad on a laptop computer attached to the back.

The nanoTouch is designed to be held by the edges in one hand while you operate the trackpad with the index finger of your other hand. The cleverest touch, so to speak, is that the device uses “pseudotransparency” to provide visual feedback—basically, the “cursor” is a life-size picture of a finger that tracks with the position of your actual finger, as if you were looking through the device with X-ray glasses.

It’s a nifty effect that neatly captures the concept of back-of-device interaction; the tip of the simulated finger even turns white when you press harder against the screen, as if the blood were rushing away from that spot. Baudisch’s nanoTouch demo provoked a little flurry of publicity back in December, with coverage by Engadget and New Scientist, among others (I’ve embedded a nanoTouch video from New Scientist below). But as Baudisch explained yesterday, the finger is just for show—it’s there to quickly train the user on what’s happening. “You never see the finger in an application,” he said. “For any real application, we reduce the touch to a single point—which is how we get the finger out of the equation and enable high precision.”

By masking the screen of the nanoTouch prototype and leaving less and less of the trackpad active, Baudisch’s group has been studying just how tiny manufacturers might be able to make future devices without sacrificing usability. They’ve found that as long as a target (meaning, say, an onscreen button) is more than about 3 millimeters across, it’s possible to accurately manipulate a device with a screen measuring as little as 8 millimeters diagonally—less than the size of the fingernail on your pinky.

Baudisch suggests that such devices might be made into pendants, wristbands, or belt buckles—all of which would surely be more fashionable than wearing your smartphone on a geeky belt holster. “Back-of-device interaction is the key to making extremely small pointing devices,” Baudisch concluded.

But while certain types of devices such as music players may keep shrinking (as this classic Saturday Night Live skit about the “iPod Invisa” predicted), we’ll probably still want to …Next Page »

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It was a fairly quiet week for Northwest deals, with activity in biotech, software, and mobile. Let’s see if the sunny weather brings more action.

—Seattle Genetics (NASDAQ: SGEN), a Bothell, WA-based developer of cancer drugs, provided a worldwide license to use its technology to Millennium: The Takeda Oncology Company in exchange for $4 million upfront, as Luke reported. The technology combines antibodies that seek out tumors with toxins to make them more potent. Millennium will pay to develop the drug candidate, as well as a mid-single-digit percentage royalty on sales if it turns the technology into a product.

—Luke reported on the ongoing partnership between biotech startup VLST and Danish pharmaceutical giant Novo Nordisk in the South Lake Union neighborhood of Seattle. The original deal, announced in December, brought in $12 million to VLST in exchange for Novo gaining the rights to develop drugs against cell targets VLST has discovered for autoimmune and inflammatory diseases.

—Seattle-based Swype, which makes text-input software for mobile devices, raised $1.3 million in funding from angel investors and company management. Swype’s technology lets people enter text by tracing a path on a touch-screen keyboard using a stylus or their fingertip.

—Bellevue, WA-based Onehub, a maker of collaborative software for business users, closed about $600,000 in funding as part of an ongoing $1 million fundraising round. The investors and other terms were not disclosed. Onehub, founded in 2007, has developed a Web-based application that helps companies share information and manage projects.

—MDRNA (NASDAQ: MRNA), a Bothell, WA-based developer of drugs that use RNA interference technology, sold its assets related to a nasal spray drug for osteoporosis to Par Pharmaceutical, as Luke reported. MDRNA receives an undisclosed cash payment upfront, as well as a double-digit percentage royalty on sales of the product. Par will assume the manufacturing and operating costs related to the drug.

—Luke reported that Cambridge, MA-based Genzyme (NASDAQ: GENZ, the world’s largest maker of drugs for rare genetic diseases, is moving into cancer and multiple sclerosis by acquiring three drugs from German drugmaker Bayer AG—including one, Leukine, that gives Genzyme its first foothold in Seattle. Leukine, which is made in Seattle and Bothell, WA, boosts production of white blood cells for chemotherapy patients. Genzyme is not paying upfront fees, but expects to take over manufacturing of Leukine at a new factory in Snohomish County next year.

—Seattle cloud computing startup Skytap’s $7 million funding round from last month was worth a closer look. I spoke with CEO Scott Roza and director of product management Ian Knox about the financing, which came from the company’s existing Seattle-area investors Ignition Partners, Madrona Venture Group, and WRF Capital. Roza and Knox also touched on Skytap’s strategy as it prepares to take on big players in the cloud like Amazon, Google, and EMC.

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Microsoft’s ninth annual TechFest is going on this week in Redmond, WA. This is the big demo event where researchers from all of Microsoft’s research labs around the world (based in Redmond, Silicon Valley, New England, UK, India, and China) get to show off their results to product groups, vice presidents, professors, and other guests.

I spent the morning there, and (among many other things) heard some high-level strategy thoughts from Craig Mundie, Microsoft’s chief research and strategy officer, and Rick Rashid, senior vice president and worldwide head of Microsoft Research.

Just a few highlights:

—Mundie spoke about the importance of research to Microsoft’s long-term future, especially in the current climate: “I think research is one of the things we have to do to survive in the long term,” he said. “Even big and great companies can have 30- to 40-year lifespans. My responsibility is to balance the interest of shareholders, employees, and the public, who we service through these technologies. The company would struggle to survive and prosper if we didn’t have the research investment. Companies who are struggling say, ‘We can get by with acquisitions,’ and so forth. I think that contributes to their demise. So in building research labs outside the U.S. [for example], we start first with the idea of long-term prospering.”

Mundie added, “It’s a time when it’s even more important than normal. If you look back at the economic downturns, including the beginning of the Great Depression, the companies that fared the best continued to invest in research and product development. We remain very focused in both research and development across the company.”

Asked to comment on specific areas of technology that might spur economic growth, Mundie pointed to user interfaces and human-computer interaction, particularly in developing countries where people are just starting to come online.

—Rashid said, “One of the values of basic research is you don’t know what will come of it…You invest in basic research precisely because you don’t know what the future is going to hold—you’re going to have a war, famine, economic dislocation, or technology changes, or there’s a new competitor. If you knew what you were going to do, it wouldn’t be basic research.” He emphasized the importance of looking years down the road—it will usually be at least two or three years before a project beginning in Microsoft Research will be useful to product teams.

As for specific technologies that could make a difference to Microsoft, Rashid pointed to location-aware services for social networking, virtual environments, and projects that harness the power of imaging and video using mobile devices, among others.

Stay tuned for more from Microsoft’s research and innovation showcase…

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N-trig, a computing-interface company based in Kfar Saba, Israel, announced today it has received $24 million in new funding from Microsoft and other investors, including Aurum Ventures, Challenger, Canaan Partners, and Evergreen Venture Partners. The money will help the company perfect its “DuoSense” digitizer, a hardware layer for touch screens that translates both pen- and touch-based input into signals that PC software can use. The deal seems a bit of a departure for Microsoft, which might normally bring such a device technology in-house.

But it looks like a very strategic move for the software giant. “With the introduction of multi-touch in Windows 7, integrated with N-trig’s DuoSense technology, our customers will have a new and natural way to interact with their PCs,” said Ian LeGrow, Microsoft’s group program manager for Windows Client, in a statement. “By simulating the way people write and touch naturally, N-trig is helping to make it easier to navigate your PC and enable a new class of Windows experiences.”

Despite Apple’s lead in multi-touch interfaces with the iPhone, Microsoft has a lot of experience in pen and touch-based interfaces—and a lot more to gain from them. It is also making a large investment in multi-touch and zooming technologies with its “surface computing” graphical user interface, and with projects like Seadragon and PhotoZoom coming out of its Redmond, WA-based LiveLabs. All in all, it makes sense for Microsoft to invest in a company that could help bring those kinds of technologies to the laptop and tablet PC market—without having to integrate the company into the Redmond machine.

N-trig was founded in 1999. Its touch technology is currently used in Dell’s Latitude XT tablet computer and HP’s TouchSmart tx2 laptop. The company says it plans to announce more deals like those in the coming year.

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Updated Nov. 5 with comments from senior vice president Rick Rashid (see below): You did good, Bill Gates. When you decided to build a new computer-science research lab in Beijing in 1998, you probably saw it as a relatively low-risk venture with a high upside. It would be challenging and take a lot of work on the ground, sure, but Microsoft would benefit from tapping top researchers in China and giving back to the local computer-science community, thereby earning good will in a country with huge market potential. From most appearances, the bet has paid off.

Microsoft Research Asia, which turns 10 years old today, is the largest of the company’s research labs outside of Redmond. (The others are located in Silicon Valley; Cambridge, England; Bangalore, India; and the newest one in Cambridge, MA.) It has about 350 full-time researchers and engineers, has employed 2,500 student interns, and has published some 3,000 papers in technical journals and conferences. More than 250 technologies from the lab have apparently been transferred into Microsoft products, including Office, Windows, Xbox, and MSN. Microsoft Research founder Nathan Myhrvold and senior vice president of research Rick Rashid played key roles in establishing the Chinese lab. (You can read more about its rise, and its impact on Microsoft, China, and information technology, in this book by a couple of Xconomy authors.)

This week is about celebrating with the community in Beijing—and getting work done at the same time. The Microsoft festivities include a faculty summit involving hundreds of visiting professors and administrators from the Asia-Pacific region, a technical advisory board meeting, and several lab-hosted banquet dinners. Gates himself won’t be there, but he visited in August during the Olympics. Among the Redmond returnees is Harry Shum, Microsoft’s vice president for search product development, who was the previous head of the Beijing lab. Ya-Qin Zhang, the lab director before him, is now a vice president in charge of Microsoft’s R&D and sales in China. (Microsoft now employs some 5,000 people in China.) I’m guessing the only member of the lab’s founding team who won’t be there is Kai-Fu Lee, who now heads up Google Greater China, after a high-profile split with Microsoft in 2005.

Rashid sent an e-mail to the lab and to the company’s top brass, including Gates and Craig Mundie, Microsoft’s chief research and strategy officer: “I could not be more proud of what has been accomplished. Today was a great milestone for MSR Asia and for Microsoft Research.”

Reached by e-mail yesterday, the Beijing lab’s current managing director, Hsiao-Wuen Hon, said he was “completely occupied” with the week’s events. Hon is a former Apple employee who started working for Microsoft in Redmond on speech and user interfaces in 1995. Born and raised in China, he helped launch the Beijing lab and did a fair bit of recruiting in the early days. Hon moved to Beijing in 2004 to join the lab as assistant managing director, and also headed the lab’s Search Technology Center.

Microsoft’s foreign research labs have always been about finding the best talent around the world, and the Beijing lab has been a pretty striking example of this strategy. “There’s no doubt China produces a lot of engineers, but 10 years ago, no one knew what their quality was, particularly when we talk about people who can do world-class research,” said Hon in a recent interview with a Microsoft press officer. “We proved we could find that top talent and give them an environment in which to succeed.”

The Beijing lab’s main technical areas have evolved somewhat over the years. The researchers now focus on user interfaces, multimedia, data-centric computing (with a recent emphasis on cloud computing), search and ads, and fundamentals like theory, systems, and networking. It will be interesting to see how the lab contributes to the company’s recent initiatives in Web-based software, services, and advertising, and in mobile software. Looking ahead, how does Hon want people to view the Beijing lab—and Microsoft as a whole? “I want them to continue to think of Microsoft as an innovator,” Hon said in the interview. “We have very fierce competition from high-tech companies and people generating new technologies. We cannot sit still.”

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Bellevue, WA-based UIEvolution, a maker of multimedia publishing software for mobile phones and other consumer electronics, announced that it has raised a Series A round led by Intel Capital, with Itochu also participating. The deal is reportedly worth some $5 million.

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Yesterday Amazon announced it has created a Web interface that makes its “Mechanical Turk” service easier for businesses to use. Until now, companies needed software coding expertise to set up and manage the service, whereby anonymous Web users can sign up to perform small tasks for small payments. In Boston, Wade recently wrote about one company that uses the service, Needham, MA-based Mobicious, to screen photos submitted to its SnapMyLife mobile phone application.

Launched in late 2005, Amazon Mechanical Turk aggregates so-called “human intelligence tasks” that are hard for computers but easy for people, like recognizing objects in photos, judging whether a photo is offensive, or identifying actors in DVDs. The name comes from the 18th-century chess-playing machine called The Turk: it plays on the fact that the “machine” was actually an elaborate hoax operated by a person inside.

It’s a pretty interesting idea, and now a much broader range of companies can potentially use it. ZDNet has a nice piece explaining what business users can do with it, and showing the new interface that attempts to take the service “beyond the geek chic crowd.”

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