Microsoft (NASDAQ: MSFT) wants to turn phones running Windows 10 into portable computers.

The company showed off the technology, called Continuum for Phones at its annual "Build" developers' conference. Instead of merely allowing a computing experience to pass from phone to tablet to PC or any of those in whatever order, Continuum actually adapts what you see to the context you're using it in.

That means that if you connect a Win10 phone to a monitor and a keyboard, it will behave like a PC, not a phone projected onto a bigger screen. This is possible because the new WIndows 10 operating system is the same whether its running on a PC, a tablet, or even a phone.

Essentially with its next generation of Windows Phones Microsoft is putting a PC in every pocket (or at least the pockets of the 2.8% of global smartphone market the company controlled at the end of 2014, according to IDC).

How it works

Microsoft produced a video released during Build which explains how Continuum works. In it Windows executive Joe Belfiore gave a succinct explanation of how the tech works.

You'll be able to carry a new phone device in your pocket and then at any time connect it to a mouse, keyboard, and larger screen. and unleash a PC experience almost just like the one you'd get from a full PC device.

Continuum does not create an exact replica of the PC experience, but it does rescale everything for whatever screen it's attached to. This was demoed using the various Office apps during Build and the usefulness of the feature was obvious. The interface for Excel, for example, when optimized for a phone screen makes it hard to use certain functionality. Plug it into a monitor, add a keyboard, and mouse, and the user has a computer-like experience optimized for the bigger screen.

Belfiore offered the example of a travelling worker bringing only his phone with him stopping to work at touchdown spaces provided by his company complete with monitor, keyboard, and mouse-equipped workstations. "You simply connect your phone and then your Outlook Mail experience -- which you use on the phone all the time -- scales up to be a full PC-like experience."

It's not just adding a monitor out to a phone, Continuum scales Windows for whatever screen and peripherals you are using.

Two screens, operating separately

Continuum for Phone allows users to have two separate apps open running on two different screens. Belfiore explained that this might be useful in a hotel where a phone could be plugged into the room's TV "to let your kids watch a video while you're catching up on your email or text messages and they're not interrupted."

It requires a new phone

One thing that Belfiore said is that Continuum won't work on existing Windows 8 phones even though those will all get a free Windows 10 upgrade. He referenced new hardware from Qualcomm (NASDAQ: QCOM) that makes the dual-screen experience above possible.

This Continuum for Phones feature requires new special hardware capabilities which will be built into phone devices which are shipped with Windows 10," he said.

The Windows executive did suggest that the Continuum experience would be worth buying a new phone for because it's unlike any other attempts to make phones into PC-like devices.

"Other companies have built products which are kind of like this, but it's not the same," he said. "In those cases you have a phone running phone apps that's docking to a keyboard and mouse, but those phone apps were never designed to work with a keyboard, mouse, and larger monitor."

For Windows 10, apps are being created which scale across various devices and screen sizes. It's a carefully planned out experience designed to take advantage of whatever tools are on hand.

This could be a game-changer

The idea the new Windows would allow apps to be used across phones, PCs, and tablets already addressed one of the biggest problems facing the company's phones, the lack of apps. Allowing a phone to work as a computer when hooked up to the proper peripherals takes this experience even farther. It certainly changes the travel device needs for some users, and it could make people who might otherwise bring a phone, tablet, and laptop with them leave at least one device behind.

This feature could be bad news for the emerging category of stick computers including ones made by Intel (NASDAQ: INTC) which run WIndows and ones powered by Google's (NASDAQ: GOOG) (NASDAQ: GOOGL) Chrome or Android operating systems. It's also a potential game-changer in the developing world where a phone is the only device many users have.

WIth Continuum for Phones Microsoft has delivered a feature which makes it phones truly unique in a potentially very useful way. That may be enough to get people -- at least more than 2.8% -- to make the switch to the company's platform.