Microsoft patent D-pad microdisplay
In a patent published this week (and originally filed in 2005) there are hints as to the next interface on portable hardware from Microsoft. Under the heading of "color and context-adaptable hardware button" they detail their plans for a next-gen D-pad control, where the buttons themselves are layered underneath a display which, similar to Optimus' OLED-keyed keyboard, can indicate different functions depending on the on-screen situation.
The device in these appalling Patent Office photocopies looks quite like a UMPC running some form of Windows – complete with what appears to be a camera at the top right – but the interesting thing in this case is the lozenge-shaped control panel on the left bezel. In the above picture it's acting – and appearing to be – a basic direction pad, for navigation of an interface that looks a lot like Windows Media Center. Below, however, the controls have changed in function and appearance – responding to the pop-up window indicating a new IM.
There's likely no actual device like this, it's just a diagram to satisfy the patent people, but it could be a sign of things to come in any of the portable electronics fields Microsoft is currently operating in. It would seem to work best in a UMPC device, where existing designs have been criticised for the lack of hardware controls and flexibility that a full keyboard can give you. Alternatively, a portable media device could greatly ease navigation and operation using a small set of multi-function buttons the myriad functions of which the user wouldn't have to memorise.