Microsoft CEO Steve Ballmer used his opening keynote address at Microsoft's Convergence user conference to not only preview a number of updates to the company's Dynamics line of business software, but also to make a firm declaration of the software giant's enterprise market plans.

"I still get asked, is Microsoft a serious player in business applications? ... This is mission-critical for us," Ballmer asserted. "The biggest decision I made -- unless we close this Yahoo deal -- was pushing into the business applications area," he said at another point. He revealed no new details of Microsoft's ongoing attempt to buy the Web-based search and content company.

Ballmer also claimed that Microsoft is now the "leading provider of enterprise software" in terms of "total dollar volume."

A Cirque de Soleil-style, gymnastic dance routine preceded Ballmer's remarks at Wednesday's event. A squad of women dressed in white, plumes of dry ice swirling around them, climbed long sheets of cloth and spun on metal rings as a piano and guitar-driven number blasted out of the sound system in Orlando's Orange County Convention Center.

But the bulk of his presentation was a look at Microsoft's product strategy for Dynamics and its broader push around "software-plus-services" -- its bid to extend its core client applications business with hooks into the Web.

IT is grouped into several categories, Ballmer said: The desktop, the Web, servers and devices. "The future of computing is to bring together these four models," he said. "In Dynamics, we are trying to move to embrace that right away."

One key new product, Microsoft's Dynamics AX 2009, is set for release in the first half of this year.

New features include an integration with Microsoft's unified communications platform; a "one-stop shop" for data related to compliance issues; an integrated workflow framework; and broader localization and globalization capabilities, such as support for multiple languages and time zones.

Marketing materials for the new Dynamics software make much of its so-called "desirability" features. According to Microsoft, the Dynamics user experience team worked with students at the IT University of Copenhagen on "desirability studies" and created a "Feel IT" methodology.

The IDG News Service is a Network World affiliate.