LAS VEGAS (

TheStreet

) --

Microsoft

(MSFT) - Get Report

CEO Steve Ballmer gave users a sneak peek of

Hewlett-Packard's

(HPQ) - Get Report

forthcoming tablet offering during his keynote speech at CES late on Wednesday.

With plenty of buzz surrounding

Apple's

(AAPL) - Get Report

eagerly anticipated

tablet

device, other tech companies are jostling for position.

Clearly keen to put Microsoft's own stamp on the technology, Ballmer carefully avoided the word "tablet" during his presentation, but confirmed that Microsoft's software will soon appear on a number of "slate" devices. Touted as a challenger to netbooks, touch-screen tablet/slate devices are expected to occupy a

space

somewhere between low-end PCs and smartphones, effectively creating a new consumer technology niche.

"Our OEM (Original Equipment Manufacturer) partners are doing some great work with slate PCs that will come on the market this year," said Ballmer, pointing to a handful of computers from H-P's

Pegatron

and

Archos

.

The Microsoft supremo, famous for his flamboyant on-stage antics, was almost reverential when discussing H-P's mysterious tablet offering, and was soon brandishing the technology.

"It's almost as portable as a phone and as powerful as a PC running

Windows 7

," he explained. "It's perfect for reading, surfing the Web."

With a screen much smaller than a PC, but significantly larger than a smartphone, the H-P device was displaying a downloaded copy of the

Twilight

book.

"This great little PC, which will be available later this year -- I think customers will be very excited about," said Ballmer, holding the device up to the audience. "I am using the Kindle software for the PC."

Tablets are set to become one of the big tech

trends

of 2010. Chinese PC giant

Lenovo

, for example, used CES to unveil its

IdeaPad

. Described as two PCs in one, the IdeaPad can function as either a clamshell notebook or a touch-screen tablet.

Microsoft and H-P have become increasingly close in recent years and the two firms announced a new partnership at CES, which will see Microsoft's

Bing

search engine and

MSN

Web site used as the default setting for H-P PCs sold in 42 countries.

Ballmer also used his keynote to plug the HD2 cell phone from

HTC

, which he said will be available on

T-Mobile

in the U.S. The device, which runs Windows Mobile 6.5, is already sold in Europe, and the Microsoft CEO spoke glowingly about his company's mobile operating system.

"Sharper, brighter and richer screen technologies really do make a difference," he said, adding that more cell phone news is imminent. "I will have a lot more to say about phones next month at the Mobile World Congress."

Ballmer was joined on stage at the Las Vegas Convention Center by Robbie Bach, president of Microsoft's Entertainment and Devices division, who outlined the company's gaming strategy. In addition to a slew of blockbuster games this year such as the latest versions of "Halo" and "Call of Duty," Bach explained that Microsoft is planning a revolution on its Xbox 360 console.

"2010 is going to be the biggest year in Xbox history," he said, explaining that the software giant is creating new ways for people to interact with their games. Dubbed "Project Natal," Microsoft is developing a sophisticated image-capture technology which lets players use their own bodies as video game controllers, he said.

Project Natal, or the Natural User Interface, will be available in the 2010 holiday season, according to Bach.

-- Reported by James Rogers in Las Vegas.

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