Yes, ESRI has a true 3D product as do several commercial companies. Numerous schools have worked in this area as did SRI. In fact it was and remains an area close to the heart of a former United States Vice President. We make no claim that Google Earth is alone in the attempt, but I do observe that we've seen no suggestion yet of a 3D digital earth product from Microsoft.

They have a 2D panning style web application ("MSVE") that competes with Google Maps, Yahoo! Maps, and MapQuest here in the United States. They have claimed that oblique 2D photos of some locations will be an option for it in the future. But even the most "flexible" marketing department would likely be too honest to describe panning a 2D photo as "imagery draped over a 3D digital globe."

I admit that I have not looked too closely at what they have been saying, but it just seemed to me the the comment in the call for papers was handing a technical attainment to MSVE that is inherently outside the scope of the product as announced, communicated, and in all probability, outside the technical means of the implementation environment despite the ability of the team and zeal of the vendor.