Singapore (CNN) -- In the next 10 years, the way people interact with computers will wildly change. Hand gestures will be as common as the click of a keyboard, and an assortment of documents will be selected not with a mouse, but with a scan of the eye.

"Today, most people's interaction is through a screen -- whether they touch it, type it, point or click, it's still just graphical user interface," says Craig Mundie, chief research and strategy officer of Microsoft.

"While that's very powerful and has a lot of applicability, I think it will be supplemented in dramatic ways by what we call a natural user interface," Mundie said in an interview with CNN on the sidelines of November's Asia Pacific Economic Cooperation CEO summit in Singapore.

Mundie sat with CNN to discuss his vision of what computing will look and feel like in the decade to come. Much like Nintendo's Wii and Sony Playstation 3 are adding physical interactivity to game play, Mundie believes the next decade will see a revolution in the way people physically use computers.

"This will be the ultimate aggregation of the ability of the computer to emulate human senses of sight, hearing, speech, touch, gesture and couple them together in a different way for people to interact with a machine."

Few people in the world are more influential in creating that future than Mundie, who took over the reins as head of the world's largest computer science research department when Microsoft Chairman Bill Gates announced his transition away from day-to-day work at the company he founded.

As such, Mundie keeps his eyes fixed toward the future of computing. With an annual budget of $9.5 billion, Microsoft spends more than any other company on research, Mundie said. His department's budget wasn't cut during the downturn.

"I tell people my time horizon is between three and 20 years in the future," he said.

What will fuel the increase in interactivity is powerful new multiprocessor computers which are expected to be widely on the market by 2012.

"With that we should get a significant performance gain, in some cases more than a factor of 100," he said.

"So what you ask yourself then is, what do you do with a machine that is 50 to 100 times faster? To me, you start to move the basic model of how people interact with computers," Mundie said.

The first major commercial application of that technology is expected next year, when Microsoft is scheduled to release a new line of its Xbox consoles that eliminates the need for hand-controllers altogether -- essentially, the players become the controllers.

"Sometime next year the Xbox team will announce this new type of camera which allows you to sit on that sofa along with up to three of your friends, or stand and move around, and have the Xbox system calculate in real time the angular position of the 22 major joints in your body," Mundie said.

"You might play games that way. You might sit there and look at a catalogue of movies to watch and just flip your hand like you were turning pages in a book and they would flip on the screen and point at the one you want to play," he said.

Moving into 'the cloud'

Also adding to the firepower of computers in the next decade, Mundie believes, is the evolution of "cloud computing" -- the move of computing power from home PCs and laptops and onto the Web.

"I think of 'The Cloud' as taking the publishing abilities of the Internet and adding programmability to it," he said. "And so these high scale things -- coupled with these new devices, which are smarter, perhaps more anticipatory in how they interact with you -- this will create a new computing platform which will allow us to attack a new range of problems that in the past have really eluded us."

Mundie envisages a day in the near future where you have a discussion on how to lower your carbon footprint -- with your house.

"You want to be able to make a contract with your house that says, look, this is the policy I want with my family about how green I want to be. I don't like to be super uncomfortable but you can mess around with the air conditioning a little bit," he said.

"And if I bought an electric car, make sure you charge it up to meet my driving requirements but don't charge in the expensive part of the day.

"You should be able to describe the problem or the policy you want and the computer should be able to somehow implement that," he said.

"It sounds a bit Star Trek-ish to some people but I really think we're within a few years of starting to see the introduction of these kind of things -- largely as a function of the increase in computing power both locally and in terms of the backbone of the Internet in the cloud."

On a broader level, he believes environmental computing will be able to give policy makers real-time analysis of carbon emissions and its global impact on the environment. Creation of 3-D science work stations and healthcare applications are considered strong business opportunities in the next decade, he added.

Mundie has applied his vision of a high-tech living to his own home, which he completed 18 months ago is tricked out with state-of-the-art computer controls, communication and automation with screens of various size dotted in every room.

"There is a uniform graphical interface that allows you to control almost anything in the house," he said. "You can control the drapes, lights, the fireplaces and audio systems."

His wife's request?

"Her specification is I had to deliver one-button television," he said. "And so I did that."

Reference CNN.com