Last week I attended “The Online Opportunity” at Microsoft’s headquarters here in London. The main attraction was that Steve Ballmer, CEO, was giving a talk about his company’s take on the brave new world of Software as a Service and doing business online in general. Microsoft Startup Zone has a video recording of Ballmer’s and all the other talks.

Ballmer reiterated MS’s “use Suse or be afraid” position on Linux, i.e. that companies should use Novell’s Linux distribution to avoid being sued by Microsoft for patent infringement (Novell is a Microsoft partner).

He also discussed the drawbacks of the “free with ads” business model and noted that Microsoft had never had much luck in monetising Hotmail. He stated that Google was having the same problems even though “they read your mail and we don’t” (a comment that surfaced on Slashdot today).

Although his performance wasn’t as energetic as on some previous occasions, Microsoft’s man in the bridge came across as sensible, pragmatic and knowledgeable.

For more comments on the event, check out the coverage by Simon Willison and Jeremy Keith.