Web services will have a "catalytic effect" on software development; speech recognition will go mainstream in three to four years; search capabilities will feature richer, clearer interfaces; and security, well, Bill Gates is not about to let security get in the way of his digital vision.

Addressing 7,000 developers during a recent visit to Singapore, Microsoft's chairman and chief software architect Gates described software as "the fastest changing element" in a world of technology which is also evolving on other fronts. Hardware improvements are occurring at an "exponential rate" with marked increases in networking speeds and storage capacity, the availability of 64-bit computing on standard servers is paving the way for the technology to go mainstream with low-cost hardware, and a common architecture is emerging from the laptop to the server.

Information will be available on portable devices, connected through wireless efforts in areas such as Wi-Fi and 3G. The phone will get richer, becoming an electronic wallet, connecting users to maps.

Even the elusive promise of speech recognition will be realised in three to four years, Gates said. He noted that in an artificial environment, the computer already comes close to humans in recognising speech. What it does not quite have - yet - is the human ability to distinguish background noise from significant signals. But, pointing to the reduction in error rates, Gates predicted that the problems facing speech recognition will be solved by this decade.

Breakthroughs in software will come very quickly, Gates predicted. Microsoft has doubled its research and development budget in the last four years and now spends about $6 billion a year on R&D. And this is complemented by research by partner companies. The main obstacle is security. "We have to surprise people with our ability to tackle it," Gates said.

In its efforts to boost IT security, Microsoft is addressing what Gates says is the three vital pieces. The "who" piece: making sure users of a system are who they say they are by using the directory and incorporating a higher degree of authentication. The "where" piece: whereby systems connect only when they need to, with the exception of the mail or web server. And the "how" piece: tools to write secure code and automate code quality assurance, identify code that is being written and keep it up to date.

Microsoft is also hoping is to reduce the running costs of existing systems in order to free up IT budgets for investment in new applications, Gates said.

In his speech, he also spoke about Microsoft's Dynamic Services Initiative, which allows software to be managed without much manual layout, and the System Definition Model, a super-set of industry standards for managing software.

He highlighted the three key audiences to keep in mind when dealing with software - the worker who deals with information; the developer who builds extensions of applications; and the IT department, which needs to maintain directories, manage the system, provide support and generally improve productivity. There is a need for one architecture that addresses all these needs, he said.

This is where Web services comes into the picture. While the Internet gave us the ability to send information with standards like TCP, advances in Web services and XML allow electronic records to be exchanged by systems of various types.

Web services will continue to have a catalytic effect on software developments, allowing software to connect at the component level, Gates said. The services oriented architecture implies software can be connected no matter what language it is written in.

The competition in the software space will then center on who has the most efficient development tool, and on bringing information to standard tools that people are already familiar with.

Enter Office 12. Scheduled for rollout next year, Office 12 will feature XML at its core, in all the file formats. Even before that, XML support will make its way to development tools and the database to enable interoperability. "More people will be writing specialized applications that connect to office," said Gates.

He also spoke about the need to tackle information overload - to prioritise data, organize email and eliminate spam.

Longhorn Beta 1, which will be released this summer, will feature built-in search capabilities which allow users to locate information and build an index using a richer and clearer interface. The new search feature will impact the way users navigate information, he said. The system will have a higher-level understanding of documents and not lead users on a "treasure hunt" that now takes 11 minutes, he said, in reference to existing search mechanisms.