Microsoft insiders claim that the company was kicked out of the keynote for 2013 and beyond, so the Redmond company decided to pull out of the CES tradeshow altogether.

As previously reported, both Microsoft and the organization behind the CES trade show, the Consumer Electronics Association (CEA), stated that the Redmond-based company will no longer make the keynote presentation starting 2013. The 2012 show that takes place in Las Vegas in the next few weeks will be the last time Microsoft not only makes the opening presentation, but the last time the company will even reserve space for a booth to show its upcoming products.

While writing the previous report, what seemed strange about CEA’s official comment was in the way it worded one specific sentence: both CEA and Microsoft have agreed that the time has come to end this great run, and so Microsoft will not have a keynote at the 2013 CES. The organization later reported that Microsoft has chosen not to reserve the Central Hall exhibit space as it has in the past. If anything, the CEA message indicated that something happened between Microsoft and CEA, thus provoking Microsoft to pull its exhibit and move on.

In a statement from Microsoft, the company said it wouldn’t have a booth because its product news milestones “generally don’t align with the show’s January timing.” But employees within Microsoft are now reporting that the CEA nuked plans for future keynote presentations by Microsoft for unspecified reasons, so in response Microsoft decided to pull out of the show entirely starting 2013.

“Microsoft didn’t pull out of the keynote — they were kicked out. Big difference,” claims one unidentified Microsoft employee (and for good reason).

GigaOM reports that a CEA executive would not comment on the insider information, but Frank Shaw, the Microsoft corporate VP who posted the Microsoft blog on Wednesday revealing the CES exit, referred all question back to his post about the timing of the event which doesn’t correlate with Microsoft’s product news milestones. And he may have a point: Windows 8 Public Beta launches in February, whereas Microsoft typically sports its new Xbox products during E3 in June and additional Microsoft revelations at MIX (2012) and BUILD (2012) conferences. That said, does Microsoft really need to make an appearance at CES?

The Verge later provided a follow-up to GigaOM’s report, saying that its own source “close to the matter” painted a less-dramatic picture of the Microsoft departure. According to the report, the CEA approached Microsoft last year and requested that the company sign on for another three years to keynote and present its products at CES. But Microsoft reportedly declined the offer and chose a single year deal which covers the upcoming 2012 show.

“Our source did indicate that the CEA was interested in playing the field for the lead keynote address, and that Microsoft would ultimately have had to pony up more cash for the privilege of holding onto its spot (everybody at the show, even Microsoft, pays to exhibit and participate),” The Verge reports. “As we were made to understand it, Microsoft simply didn’t feel it was getting a reasonable return on its investment with CES, and the reality is that the show hadn’t aligned with its launches for a few years.”

That said, both sides weren’t getting what they needed out of the relationship, and simply chose to part ways. But as with the GigaOM report, both versions of the story stem from “insider sources,” so it’s somewhat hard to distinguish which is fact and which is fiction. The latter situation is probably what transpired given that many technology companies have pulled out of CES in the past. Still, the former “Microsoft got kicked out” GigaOM story makes for a more dramatic discussion at the water cooler.