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Yet Microsoft still has ammo in the numbers department to take shots at its biggest rival, and many others, besides.
MICROSOFT SAYS: Buy Windows 7 today, keep same PC for Windows 8 upgrade
CEO Steve Ballmer focused heavily on numbers proving rapid adoption of Microsoft technology -- with the exception of Windows Phone 7 -- on Monday as the company's Worldwide Partner Conference kicked off in Los Angeles.
Windows 7 has sold 400 million licenses in less than two years, Office 2010 has sold more than 100 million licenses, 50,000 businesses have trialed Office 365 since the cloud service's launch two weeks ago, Windows Server locked up 75% of quarterly hardware shipments, and usage of the Bing search engine has tripled in the past year.
The only disappointment Ballmer mentioned was Windows Phone 7, but he claimed the future is bright.
"Phones: We've gone from very small to very small but it's been a heck of a year," Ballmer said. "You're going to see a lot of progress in that market."
With Nokia betting the farm on Windows Phone 7, and more than 20,000 applications built for the platform in the last eight months, Ballmer pointed to analyst predictions that Windows Phone 7 will eventually outsell the iPhone and trail only Android.
"Gartner and IDC both did predictions this year, saying Windows Phone would be the No. 2 phone in the market by 2015," he said.
Ballmer didn't detail numbers for Windows Azure, which lags cloud rivals such as Amazon EC2.
But he expressed excitement about Bing, Microsoft's answer to Google's search engine. The Bing site itself grew U.S. market share by three points, moving up to 14.1% this year, he said. Adding in Yahoo, which now powers its search results with Bing, Microsoft is "collectively serving 30% of the search needs of users here in the U.S.," he said.
Microsoft's Worldwide Partner Conference is the event where Microsoft and partners get together to figure out how to make more money. A Microsoft-sponsored IDC study found that Microsoft partners, including service providers and software developers who build for Windows platforms, made more than $500 million in 2010.
"For every dollar Microsoft makes, partners make $8.70," said Microsoft's partner group corporate VP Jon Roskill.
Despite momentum for Microsoft's search engine, Ballmer said, "Bing is probably the Microsoft product or service that our partners spend the least amount of time with right now. I think that will change over the next few years."
Microsoft showed how Bing is more a "decision engine" than a search engine, giving as an example a widget that let you search multiple ticket vendors for seats to baseball games while getting a list of best prices and a virtual view of the field from the seats up for sale.
Bing will grow in importance as it is integrated more heavily with Windows Phone 7, and even in the Xbox, with voice-activated search on the gaming console.