8:02 a.m. As I wrote yesterday, Strategic Decision #1: Steve Ballmer's decision to speak today, "directly to investors." He'll be answering questions from the little guy and the question on everyone's lips: will he be defensive?

8:04 a.m. Ballmer wants to speak about the business from both the perspective of an investor and a manager, and he promises not to yell at the audience. Heh. He starts out by saying that the next 10 years has as much potential for world-changing strides in computers and software as the last 10 years, and he's excited to be part of a company which "invests, profits from, and takes advantage of the incredible opportunity there is to innovate."

8:06 a.m. The thing that will change in the next 10 years? Digital writing. "Pencil and paper will be replaced by superior technology that is digital. And somebody will have the ability to benefit from that technology." He already sounds both (a) angry and (b) frantic. Maybe it's just his thang.

In the midst of all the bad Microsoft news and yesterday's four-year low, it's worth asking the somewhat theoretical question: what premium does Microsoft's laudable and long-term commitment to basic research add to the long-term value of the stock? 

There's little question that MSFT has created a research establishment that's much in the mold of the early Bell Labs and Xerox PARC (more in a moment as to whether that's a good or bad thing): lots of pure academics hired from top universities who apparently have quite a bit of freedom to select research topics and to publish.  Here's a quote from a recent speech by Rick Rashid, the well-respected Microsoft head of research: "...we started investing in basic research at Microsoft 14 years ago...today we’ve grown to over 700 researchers worldwide. And to put that in perspective, that’s the equivalent of growing a major computer science department, like a Berkeley computer science faculty, a year every year for 14 years. And we’re expecting to double that rate of growth over the next two years. We believe that investing in basic research in Computer Science is critically important at this juncture."

But is it critically important to the value of the company?