Back in May, I wrote about the transformation of Xbox. Since then, we’ve had a lot to say about Xbox, TV and entertainment, and honestly, the conversation has just begun.

Televised entertainment is being transformed, not only in how it’s delivered, but in how it’s becoming more social, more interactive and more personal. Easy two-way interaction creates entirely new forms of TV entertainment, and nowhere is that more apparent than on Xbox 360.

In theater and movies there is a concept of the “fourth wall,” an imaginary barrier that keeps the audience separate from the art that is unfolding in front of them. The same idea translates to TV entertainment. There have been all sorts of attempts to break the wall; who can forget Ferris Bueller talking to the audience, for example? But what if you could really break through that wall, and actually interact with your favorite characters and storylines, and become part of the show, participate naturally with the community of fans watching a popular show? Soon, with Kinect and Xbox LIVE, people will do all that and more.

In New York today, we launched a new initiative called “playful learning”, the result of our collaboration with some of the brightest minds in child learning and development.

I’ve talked on a number of occasions on The Official Microsoft Blog about Natural User Interface (NUI) and the transformational effect this will have on how we interact with technology in the years to come. Kinect is one technology that pushes the boundaries of how we can build more natural ways to interact with technology – through gestures and speech – but that’s only one aspect of our work around NUI.

In the video below, you’ll see Kinect and a number of other technologies, and hear from some of the brightest minds at Microsoft pushing this next frontier of technology forward. As well as gestures and speech, touch is an important part of NUI. Steve Bathiche, who heads up our Applied Sciences Group, shows us Surface 2.0, and Andy Wilson of Microsoft Research shows us a project called LightSpace. Curtis Wong shows us the integration of Worldwide Telescope with Kinect, and introduces the notion that context – what we’re doing, or have done, or where we are located – will all play a part in the emergence of natural user interfaces.

This was a big week for Microsoft on the news front. We announced the close of the Skype acquisition, Xbox 360 news and plenty of other news bits for all the Microsoft news hounds out there.

Microsoft officially welcomes Skype. On Thursday, it was announced that Microsoft had closed its acquisition of Skype. “Skype is a phenomenal product and brand that is loved by hundreds of millions of people around the world,” said Microsoft CEO Steve Ballmer in this press release on the Microsoft News Center. Tony Bates, president of the Skype Division of Microsoft, also weighed in on the deal in this Thursday post on The Official Microsoft Blog, which features a short video of Bates talking about the acquisition.

What a week for Xbox 360! Lots of big news out of Xbox 360 this week. First, Microsoft announced that the Xbox 360 continued its reign over its competitors in September and has now sold more units in the U.S. than any other console for 15 of the past 16 months.

I am delighted to announce the deal with Microsoft has formally closed, and Skype is now a division of Microsoft. This represents a huge leap forward in Skype’s mission to be the communications choice for a billion people every day.

Joining forces with Microsoft is the best way to accelerate this mission and capitalize on our position at the intersection of social, mobile and video communications. Simply put, we want to transform communications.

Xbox 360 is on a serious roll.

Today, Microsoft announced that the Xbox 360 continued its reign over its competitors in September and has now sold more units in the U.S. than any other console for 15 of the past 16 months. The popular digital entertainment system is now poised to finish 2011 as the best-selling console. The news follows closely on the heels of our announcement last week that nearly 40 world-leading TV and entertainment providers, including Bravo, Comcast, HBO, Syfy, Verizon FiOS in the U.S., BBC in the UK, Rogers in Canada, Telefónica in Spain and Televisa in Mexico and many others, will begin providing live TV and video-on-demand experiences via Xbox 360 this holiday season.

The massively popular Kinect system also continues to gain momentum. By this holiday season, the Kinect’s portfolio of games will grow to 75 titles – four times larger than last holiday season.

This morning, I gave a keynote at the PASS Summit 2011 here in Seattle, a gathering of about 4,000 IT professionals and developers worldwide. I talked about Microsoft’s roadmap for helping customers manage and analyze any data, of any size, anywhere -- on premises, and in the private or public cloud.

Microsoft makes this possible through SQL Server 2012 and through new investments to help customers manage ‘big data’, including an Apache Hadoop-based distribution for Windows Server and Windows Azure and a strategic partnership with Hortonworks. Our announcements today highlight how we enable our customers to take advantage of the cloud to better manage the ‘currency’ of their data.

In this edition of The Midweek Download, we’ve got stories on Windows 8, Windows Phone, Internet Explorer 10 and a video featuring Microsoft Chief Research & Strategy Officer Craig Mundie.

Reducing runtime memory in Windows 8. The runtime memory usage of Windows 8 is an important factor in determining the Windows 8 system requirements, as well as the broadened spectrum of devices that will host Windows 8. As you know, we’re delivering the complete Windows 8 experience on SoC-based devices characterized by low power consumption. This makes it even more important to leave lots of memory available for multiple concurrent apps and to sustain the overall responsiveness of devices. For more on this story, read this Oct. 7th post on the Building Windows 8 Blog.

More on porting iPhone and Android apps to Windows Phone. Windows Phone 7.5 is just out of the door, smoothly going to users’ phones. So, if you or your friends haven’t started to look at Windows Phone, this is great timing. Microsoft is excited to announce new guidance based on migration samples and a SQLite to SQL Server Compact database conversion tool. We hope that these new items, combined with our previous extensive guides (for Android, iPhone, and Symbian Qt), will accelerate your ramp-up time, and improve your experience in porting apps to Windows Phone from iPhone and Android. Read this Monday post on the Windows Phone Developer Blog for more detail.

It was a big week at Microsoft to say the least. In this edition of Weekend Reading, we’ve got news stories about Skype, Xbox 360, Hotmail and Windows Phone 7.5. Check ‘em out.

European Commission approves Skype acquisition. Last May, Microsoft and Skype Global S.à r.l announced that they entered into a definitive agreement under which Microsoft would acquire Skype, the leading Internet communications company, for $8.5 billion in cash from the investor group led by Silver Lake. Today, the acquisition was approved by the European regulators. Read this press release on the Microsoft News Center to see a statement from Brad Smith, executive vice president and general counsel at Microsoft, regarding the approval of the acquisition by the European Commission.

Microsoft teams up with Comcast, Verizon and others in slew of content deals. Earlier this week, Microsoft announced that nearly 40 world-leading TV and entertainment providers, including Bravo, Comcast, HBO, Syfy, Verizon FiOS in the U.S., BBC in the UK, Rogers in Canada, Telefónica in Spain and Televisa in Mexico and many others, will begin providing live TV and video-on-demand experiences via Xbox 360 this holiday season. To get the rest of this story, read this Wednesday post on The Official Microsoft Blog. Below is a screenshot showing off the voice-powered search feature on Xbox 360:

On Sept. 27th, Microsoft started rolling out Windows Phone 7.5, the next version of the Windows Phone mobile platform.

Windows Phone 7.5 comes chock full of hundreds of new features and experiences designed to build on the phone’s intuitive, “people-first” foundation – multitasking, more integrated apps, primo mobile Web browsing, and powerful and personalized tools, like integrated social networking and conversation threads, for connecting with the people in our lives.

Now that the update has been available for a while, we’d like to ask readers this: What’s your favorite new Windows Phone 7.5 feature?

Over the past year and a half, the Hotmail team has worked extremely hard to release both improvements to the service and completely new features that help people work through their e-mail quicker.

Unquestionably, we’re all extremely proud of the product we’ve created – today more than ever.

At the same time, we understand that there’s still a perception that Hotmail is slow, spammy, lacking on storage – essentially outdated.

We looked at that as a challenge. Why not go above and beyond to not only fix the pain points but create an inbox that feels like a true upgrade compared to the others out there?

Of all the screens in our lives, the TV has changed the least – until now. Watch TV. Turn the knob. Grab the remote. Put in a (tape/disc). Stream something. A few months ago, I said (to paraphrase), prepare for the world to change. Today, it changes.

For context, a couple years back, we used to talk a lot here about “three screens and a cloud.”

By that, we meant that in the developed world, there are three primary screens that we interact with throughout our days – A PC, a phone and a TV. In recent years, the energy and focus within the industry has primarily been on the phone and PC, and of course that continues. But now the TV viewing experience is being transformed as well, through the magic of software and internet-connected services.

Look no further than this morning’s announcement that nearly 40 world-leading TV and entertainment providers, including Bravo, Comcast, HBO, Syfy, Verizon FiOS in the U.S., BBC in the UK, Rogers in Canada, Telefónica in Spain and Televisa in Mexico and many others, will begin providing live TV and video-on-demand experiences via Xbox 360 this holiday season.

In this edition of The Midweek Download, we’ve got new stories from Building Windows 8, a few news bytes for Windows Phone developers, plus more on BUILD, Internet Explorer 10 and Windows Azure.

The Start screen in Windows 8. Earlier this week, the Windows team kicked of a series of posts on Building Windows 8 focused on the evolution, design and reimagining of the Start screen. Check out this Monday post and this Tuesday post on Building Windows 8 to get the whole story. Below is a screenshot of the Metro-style Start screen in Windows 8:

I'm pleased to share with you the Microsoft 2011 Citizenship Report. The report provides an overview and assessment of our work over the past fiscal year (July 2010 to June 2011) to serve communities and work responsibly.

We release our Citizenship Report at the same time as our Annual Financial Report to give our broad base of stakeholders a full view of Microsoft’s financial and non-financial performance. Corporate responsibility means more than returning value to shareholders – it means engaging with stakeholders to address our responsibilities in the areas of environmental, social and governance issues. We believe all corporations have, as part of their license to operate, a responsibility to contribute positively to society on a global scale. To quote our company’s founder, Bill Gates: “It takes more than great products to make a great company.”

Our Citizenship Report details our efforts to increase business value while also benefitting society. Our goal is to provide continued transparency and accountability across our business operations. To support this, we have evolved our reporting to candidly and thoughtfully discuss our social and environmental performance, our progress against goals and our focus going forward. We clearly share where we are on track, where we are falling short and how we intend to close the gaps.

The big news this week out of Microsoft was the start of the roll out of Windows Phone 7.5. However, the company also made significant announcements focused on a new, broader smartphone partnership with Samsung and the release of new features for Office Web Apps. Oh, yeah – Gears of War 3 is also the biggest game of the year after a blockbuster first week with gamers.

Windows Phone 7.5 now coming to you. Yes, it’s true. The highly anticipated Windows Phone 7.5 is now rolling out. The first major release since Windows Phone 7 launched less than a year ago, the 7.5 release offers hundreds of new features and experiences designed to build on the phone’s intuitive, “people-first” foundation – multitasking, more integrated apps, primo mobile Web browsing, and powerful and personalized tools, like integrated social networking and conversation threads, for connecting with the people in our lives. For more on who will get the update first, how to install it and more, read this Tuesday post on the Windows Phone Blog. If you’re looking for some reactions to Windows 7.5, check out this Windows Phone Blog post, which features reactions from Engadget, CNET and assorted other technology press. Also, check out this rundown of five pinworthy Windows 7.5 apps, including eBay, Open Table and more. Below is a screenshot of the ZTE Tania, a Windows Phone 7.5 device that will be available in several European countries later this year:

Last week, we presented our first public webcast on Microsoft’s activities related to the end of daylight saving time in the Russian Federation, a change we noted earlier this year. For our customers and partners worldwide, this means there are some things to be aware of, and in some cases, work to do to prepare for this change.

First, a little history: this summer, the Russian government adopted a new law to cancel daylight saving time (DST) in the country. This means that Russia will not “fall back” to the previous Russian Standard Time zones this fall. People in the country will leave their clocks on “Summer Time” (as it’s known in the region) and no longer have to make the twice-a-year changes to their clocks in the future. Such a change requires various adjustments. While the elimination of DST directly affects those living in Russia, given the size and impact of the Russian market, the ramifications are global. At Microsoft, we’re stepping up work with our customers and partners to address the impact on users’ computers and servers.

In this edition of The Midweek Download, we’ve got stories about the 20th anniversary of Microsoft Research, how Nokia developers can learn Windows Phone even faster and a look at another feature of Windows 8.

The magic behind the curtain: celebrating MSR’s 20th anniversary. September 2011 marks the 20^th anniversary of MSR. To celebrate the occasion, MSR is hosting a day of conversations at many Microsoft research labs around the globe to discuss the key technology trends—like natural user interface, “big data,” and machine learning—that are transforming the way people use computers and what they can do for us. Want to know more? Check out this Tuesday post on The Official Microsoft Blog.

Signing in to Windows 8 with a Windows Live ID. “With Windows 8, we introduce the optional capability to sign in to your PC with a Windows Live ID and, by doing so, gaining the ability to roam a broad range of settings across all of your PCs,” writes Steven Sinofsky, president of the Windows and Windows Live Division on Building Windows 8. In this Monday post on Building Windows 8 by Katie Frigon, the group program manager of the You-Centered Experience team, describes the feature and its benefits. Don’t miss it.

Building on the recent successes of the Rustock and Waledac botnet takedowns, I’m pleased to announce that Microsoft has taken down the Kelihos botnet in an operation codenamed “Operation b79” using similar legal and technical measures that resulted in our previous successful botnet takedowns.

Kelihos, also known by some as “Waledac 2.0” given its suspected ties to the first botnet Microsoft took down, is not as massive as the Rustock spambot. However, this takedown represents a significant advance in Microsoft’s fight against botnets nonetheless. This takedown will be the first time Microsoft has named a defendant in one of its civil cases involving a botnet and as of approximately 8:15 a.m. Central Europe time on Sept. 26^th, the defendants were personally notified of the action.

The Kelihos takedown is intended to send a strong message to those behind botnets that it’s unwise for them to simply try to update their code and rebuild a botnet once we’ve dismantled it. When Microsoft takes a botnet down, we intend to keep it down – and we will continue to take action to protect our customers and platforms and hold botherders accountable for their actions.

September 2011 marks the 20^th anniversary of Microsoft Research (MSR). To celebrate the occasion, MSR is hosting a day of conversations at many Microsoft research labs around the globe to discuss the key technology trends—like natural user interface, “big data,” and machine learning—that are transforming the way people use computers and what they can do for us.

What better time, then, to pause, reflect on and celebrate the role of MSR at Microsoft, the impact of their work inside and outside the company, and what the future may hold.

Spurred by Bill Gates’ vision that someday computers will see, listen, speak and learn, Bill, Rick Rashid and Nathan Myhrvold created MSR in 1991 with a mission to advance the state of the art in computing through a combination of basic and applied research. That mission hasn’t changed, but the organization has blossomed to 12 facilities around the world (including Redmond, Wash.; Cambridge, U.K.; Beijing; Mountain View, Calif.; Aachen, Germany; Bangalore; Cairo and Cambridge, Mass.), currently supporting more than 850 researchers in over 60 fields of research.

This edition of Weekend Reading is chock full of Microsoft news, including stories on the introduction of video on the Bing home page, re-engineering the boot experience on Windows 8 and the highly anticipated release of “Gears of War 3” for the Xbox 360.

Bing home page springs to life with fall video. Bing is celebrating the first day of fall with a first for its users: an autumn-hued video on its home page. Visitors to the Bing home page today will be greeted by a time lapse video of the sun slowly rising over fall foliage. The video – visible to people using an HTML5-enabled browser – is the first to appear on the Bing home page, where eye-grabbing images have become an iconic part of the search engine’s brand. Read this feature story on the Microsoft News Center to see the video and learn more.

‘Gears of War 3’ is an action-packed father and son story. “Gears of War 3,” the dramatic, action-packed, much-anticipated conclusion to the blockbuster Xbox 360 trilogy, is now available. Here’s what fans of the series need to know: the final installment of “Gears of War 3” opens quite some time after the conclusion of “Gears of War 2,” and life on the fictional planet Sera is hanging by a thread. Society has all but collapsed, and the troops of Delta Squad are in a desperate fight to save what’s left of humanity from an unyielding subterranean enemy, the Locust Horde. Want to know more? Read this feature story, which features a cool slideshow, on the Microsoft News Center. Below is a screenshot from the game:

Six months after I first wrote about how the Microsoft Digital Crimes Unit, Microsoft Malware Protection Center, Trustworthy Computing and our partners shut down the Rustock botnet, I am pleased to report that we have successfully concluded our civil case against the Rustock botnet operators. We’re now referring the matter, and the discovery gathered during our civil case, to the FBI for criminal review.

As you may have read in this morning’s edition of CNET, on Sept. 13^th, Judge James L. Robart, of the U.S. District Court for the Western District of Washington ruled that the domain names and Internet protocol addresses used to host the botnet would be effectively removed from the defendants’ control. This case not only enabled the take down of a botnet known to be one of the single largest sources of spam on the Internet, but it is now helping to ensure that this botnet will never be used for cybercrime again. However, we’re not stopping here.

In this edition of The Midweek Download, we’ve got a look back at last week’s BUILD conference as well as stories about Windows Phone and Internet Explorer. Check ‘em out.

Looking back at BUILD. If you’re a developer, you’ve probably heard about this little conference we had last week in Anaheim, Calif. called BUILD. It was a pretty big deal. We unveiled developer previews of Windows 8, Windows Server 8 and Visual Studio 2011 and gave away prototype Samsung PCs featuring the developer preview version of Windows 8, among other things. However, just in case you missed any of the news that came out of BUILD, check out this Tuesday post on the Next at Microsoft Blog, which features a five and a half minute video montage of the keynote highlights from the conference. If that isn’t enough for you, read this Sept. 13th post on Blogging Windows, which also has a three and a half minute video featuring interviews with engineers from the Windows team. Finally, don’t forget to vote in this Official Microsoft Blog poll asking what excited you most about BUILD.

Developers: Submit your Windows Phone 7.5 apps now, update WP7 apps in October. Last month, the Windows Phone team noted that once you publish the 7.5 version of an application, you will no longer be able to modify the existing 7.0 version. We also acknowledged that some might find this limiting, as several of you have since confirmed. We heard you, and are happy to report that, by the end of October, we will enable functionality in App Hub that will allow you to publish updates to both the 7.0 and 7.5 versions of your apps.

Last week, Microsoft made a series of announcements at the BUILD developer conference in Anaheim, Calif., including developer previews of the next version of the Windows operating system – codenamed Windows 8, as well as Visual Studio 11 and Windows Server 8.

As Steven Sinofsky, president of the Windows and Windows Live Division, put it, “We reimagined Windows. From the chipset to the user experience, Windows 8 brings a new range of capabilities without compromise.”

As you can probably see, we think the news we announced last week is a pretty big deal. That said, we’d really like to get YOUR thoughts on BUILD and what YOU thought was a big deal. That’s what the poll below is for.

News from the BUILD conference dominated news out of Microsoft this week, including a developer preview of the next version of the Windows operating system – codenamed Windows 8, Visual Studi0 11 and Windows Server 8. That said, Microsoft made plenty of news outside of BUILD this week too. Check out the collection of stories below on Xbox 360, Windows Phone and Bing.

Yes, it’s true. Xbox LIVE is coming to Windows 8. In this Tuesday post, Xbox LIVE’s Major Nelson confirmed the news that the hit online gaming service for the Xbox will indeed be coming to Windows 8. As Major Nelson reports, earlier this week at BUILD, Microsoft showed that it is easy for developers to create games for Windows 8 that take advantage of the power of Xbox LIVE. And in other Xbox news this week, several major announcements were made at the Tokyo Game Show, including updates on Forza Motorsport 4, Dance Central 2, Halo: Combat Evolved Anniversary, Gears of War 3 and many other titles. Below is a screenshot that shows Xbox LIVE on Windows 8:

Anyone who follows Microsoft knows that this week’s news is mostly focused on BUILD, a new event held in Anaheim, Calif. from Sept. 13th to Sept. 16th that outlines for developers Microsoft’s roadmap for the future. Read on for a round-up of all the news made at BUILD so far.

Microsoft presents Windows 8 developer preview. At day one of the developer-focused BUILD conference on Tuesday, Microsoft showcased a detailed preview of the next major release of Windows, code-named “Windows 8.” The company also detailed new tools for developers to help write applications for more than 1 billion people around the world who use Windows every day. Read this press release, which features a six-image slide show of Windows 8 images, on the Microsoft News Center to get the full story. Not enough detail for you? Then check out this Tuesday post on Building Windows 8 from Steven Sinofsky, president of the Windows and Windows Live Division and this feature story focused on how BUILD will outline new opportunities for developers.

You may have heard that this week we’re holding an event for the developer community called BUILD. This is a big week for the company. We’re excited to talk with developers about the future of Windows and other products and tools we’re working on.

We gave a sneak peek of the next generation of Windows - “Windows 8” - in June at the D9 conference, and this week we’ll be sharing more with developers about the direction we’re taking. We’ll provide more details about how developers can build exciting new apps on Windows with no compromises.