Meet Microsoft, the world's best kept R&D secret

• As far as 99.9 percent of the world population is concerned, Microsoft is a stodgy, old-guard technology company. Its bottom line is fully leveraged against PC operating systems and business software—hardly the building blocks of a future-thinking portfolio, right?

But scratch that cold, conservative, pedestrian surface, and you’ll find a Microsoft that’s a veritable hotbed of cutting-edge innovation. Indeed, the company doesn't just loosen its purse strings when it comes to research and development. No, it practically throws money at really big thinkers to build a more wondrous, fantastical future. In 2011 alone, Microsoft's R&D budget reached a record high of $9.6 billion (yes, with a "B"). That’s a lot of Benjamins, and they’re being spent on some decidedly awesome projects.

Let’s take at some of the more interesting examples.

Blending touch and touchscreens

CARNEGIE MELLON

OmniTouch let's your fingers do the dialing... practically on your own fingers.

Several Microsoft Research projects have revolved into transforming everyday objects into fully interactive computing surfaces. If these initiatives bear fruit, you may one day conduct your morning Facebook check on the back of a cereal box rather than on your phone.

First up is LightSpace, which uses a plethora of cameras and projectors to create interactive displays on everyday objects. The system needs to be calibrated to the room it’s installed in, but once it is, users can interact with projected menus and screens using their hands, or even move a projected display from one object to another. Don’t feel like trying to crowd your team around a projection on a small desk? Drag it over to the wall, instead. You can see a basic version of LightSpace in action in this intriguing demo video.

13 killer Chrome apps to replace your desktop software

When Tim Berners-Lee invented the first Web browser in 1990, it was just an application made to read HTML pages passively. Fast-forward to today, and the modern Web browser has become a powerful platform in itself—almost a miniature operating system, capable of running complex JavaScript code and interacting with Flash plug-ins.

Indeed, Web pages have evolved into Web apps, to the point where we can do much of our productivity work in a browser window without ever having to invest in traditional desktop software.

But how much work can you really do from a browser? Could you replace all of your desktop apps with Chrome extensions, and be none the worse for wear? After testing a bunch of Chrome apps, I found mixed results: Web apps simply aren’t designed to be complete replicas of their desktop counterparts. Although these apps have gotten a lot better in the past couple of years, you might encounter a few peccadilloes, and desktop software may still be the better choice for your unique needs.

That said, if you haven't been keeping a close watch on the growing power of Chrome extensions and Web apps, you might be pleasantly surprised by our top alternatives to popular desktop software.

Word processing: Google Drive Documents

No matter what you do for a living, you've probably spent some time using a word processor in the past week, probably even in the past 24 hours. Unless you're doing some very complicated work, you could ditch your word processor for Google Drive right now without missing a beat. Sure, the interface is different: You'll find no Ribbon of commands and functions at the top of the screen, and you'll see far fewer buttons. But Google Drive's Documents let you do all of the important things, such as format text, create titles and lists, embed images into your documents, and more.

With its powerful collaboration features, Google Docs is ideal for working on documents with friends and colleagues.

If you often find yourself emailing Word files back and forth, Google Drive might be even better than its desktop counterparts: You can just invite another person to view your document, and you can both edit the document at the same time, watching each other’s cursors at work. Add Skype to the mix, and it's just like working in the same room, even if the other person is a continent away.

The Best Free Software, Mobile Apps, and Web Services, 2012 Edition

The Internet is like a fancy Hollywood party with lots of swag: You can get tons of stuff for free, but not all of it is good. Still, some of the Web services, apps, and downloads out there are great, and don’t require you to pay a cent. Our 17th annual roundup of free stuff includes dozens of no-cost services, apps, and programs that are worth your time. To help you find the most valuable freebies, we’ve categorized them based on which types of people they’ll help most. Enjoy the free life!

(To read the related story about each category of free stuff, click the appropriate heading below, or use the contents box to the right. You can also consult our alphabetical list of all of the downloads, apps, and Web services described in our Best Free Stuff package.)