Microsoft's Surface godfather hints that Dial is just the start

Microsoft and Apple faced off with different ideas of the creative computing future last week, and in many ways Microsoft looked like more of the innovator.

The new wheel-like Surface Dial, a larger Surface Studio touchscreen computer, an improved Surface Book, and a bold attack strategy regarding affordable virtual-reality headsets as a patient build-up to a broader mixed reality future -- in which users can see virtual digital objects overlying real-world space -- gave Microsoft a unique angle compared to Apple.

In Cupertino, the big news was a smaller, thinner MacBook Pro with a tiny "Touch Bar" above the keyboard -- but with a main screen that's still decidedly touch-free. A nice laptop, to be sure, but ultimately a fairly conservative upgrade to an existing product line.

CNET sat down with Panos Panay, head of Microsoft's device business, and the person directly responsible for launching the Surface, to discuss the new Surface devices and where the Dial and other accessories potentially fit in. (Our conversation took place after Microsoft's event, but a day before Apple's news became official -- though plenty of leaks were floating around that turned out to be accurate.)

Surface Dial: Microsoft's next big PC accessory

Surface Dial might be a hint at where Surface could evolve with new, affordable and transformative accessories. I asked Panay about the excited reactions to the Surface Dial, and even he seemed surprised. But Dial, which costs $99 (about £80 or AU$130), looks like it's a big part of where Surface is going down the road.

"Accessories can somewhat be undervalued in the sense that sometimes they're too easy to talk about, but we have a couple of accessories that, without them, the experience can't be completed," he said. "If I took away your keyboard right now. Or if I took away your trackpad right now, or when you learn to use the dial and we end up taking that away, your entire flow changes."

Despite the name, Surface Dial isn't just relegated to its own products. It will work on any Windows PC that's upgraded to Windows 10 Anniversary Edition.

Panay hinted there could be more accessories beyond, which is a possible indicator of where Microsoft wants to innovate and stand out from competitors like Apple.

"That's not the last one," he said.

On the new Surface Book i7

Panay was excited to talk about Surface Book, which is really about a large enhancement to the performance base of last year's product -- Microsoft's first-ever laptop, which had a tablet-like screen that detached from the keyboard base, which in turn housed the main battery and extra graphics processor.

"When we made Surface Book we were super clear that the base was the innovation," he said. "The idea, though, when we built the product was this base can live separately. Meaning, if I wanted to create an LTE base, or if we wanted to create three times the battery, or if you wanted to create two times the power."

"The thing I was most scared about with the new book is we were able to present it in a way where it didn't just look like, 'we updated the processor,'" Panay said.

Microsoft Surface Book i7 brings powerful performance to 2-in-1 design (pictures)

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The funny thing about the new Surface Book is that, even though you could swap out last year's Surface Book top into a new base, the base isn't being sold separately yet. "We talk about that all the time, what the options are," Panay said.

But at some point, it seems, swapping new parts is the idea. "It's not as simplistic as something like Legos," he joked, "but it is modular because the OS allows so much to happen. So the truth of the matter is the OS is going to allow us to be extensible, and that's the beauty of the hardware and software working together. That's a big deal."

Even so, Panay is confident that the products being made now won't be instantly outdated. At least, that's the plan. "We wanna know that, for four to five years, you have everything you need," he said. "That you're not buying a product that you're trying to replace in 12 months."

On competing with Microsoft's own hardware partners

Microsoft still sees itself as leading the way by example for third-party manufacturers of Windows computers like Lenovo, HP, Dell, Acer and others -- though, at times, the Surface line may look like its own path.

"We are doing the thing we want to do," Panay said. "We want to create these categories, and it's super lovely that the partners are coming. It's humbling."

3D, virtual reality and mixed reality

How does this all fold into Microsoft's bold but elusive vision of mixed-reality headsets like HoloLens and affordable virtual-reality headsets (which will require graphics processors that not all Surface hardware has)? Panay said he knows the path.

I wanted to know about mixed reality, where he imagines HoloLens and Surface meeting, and what the steps between now and a mixed-reality future are. "I see it so clearly," he said with a laugh. "I won't tell you what they are."

He said that 3D creative tools and affordable VR are the stepping-stones to an eventual world of devices like HoloLens. "What is crucial is making people take these steps with you, at this point," he said. "Get on the platform now. Be part of Windows, now."

Where does Surface Studio fit?

Panay didn't specifically answer many questions about Studio during the interview, but did suggest that it's another size in the lineup.

It's also another big key in the mission to get people to start making 3D content with Microsoft tools, and doing it now.

"The best thing we're trying to do now is, you look at Paint today, Paint 3D, and you look at even Studio, you can already see where those are going to weave together even though we didn't demo them together, and you can start to see how quickly that's going to come together," he said. "And we're going to be pretty relentless about it."