Q&A: Ballmer's Tough Talk On Surface, Apple And Partners

It feels different being here. I have known you for 30 years, watched Microsoft (NSDQ:MSFT) for 30 years and with this Surface thing, it really feels different. It really feels like you guys have taken off the gloves and are going on offensive rather than defense. It is more in the Ballmer style. Talk about how Surface has changed the character of the company.

I am mostly going to just sort of note your reaction. I think it is Windows 8 that really is the catalyst for sort of stepping out.

Look, we needed to reimagine Windows. We really did need to reimagine Windows in order to take the next steps with our customers and take the next steps in competition. Whether it is new silicon support, new form factor, new UI, embracive touch and stylus, all of that stuff had to come with the new version of the operating system. So, of course you see, what should I say, stepped up competitive energy and vigor and the like. Surface is a part of that because we wanted to have the device that was designed for Windows 8 and only Windows 8, and a design that really would make it absolutely clear that you could have a device without compromise that was both a tablet and a PC. And, we think we have done that.

Don’t you think this will push the OEMs to do more innovative products?

I don’t think it is going to hurt in terms of stretching innovation. It is the time. Windows 8 is a unique opportunity not just for us, but for everybody who builds applications, for everybody who builds computers. Windows 8 is a unique opportunity. And if Surface galvanizes people around the opportunity to do hardware innovation (so be it).

How about the ability for Microsoft to do its own iPhone like competitor. Come on, you did the Surface. How about your own phone?

Right now we are working real hard on the Surface. That’s the focus. That’s our core.

Look we’ll see what happens. We have good partners with Nokia (NYSE:NOK), HTC in the phone space. I love what we got going on with the Surface. We are going to focus on Surface and our other Windows 8 Tablet partners and see if we can go make something happen.

Business wise how does Surface change the balance sheet and how you look at Microsoft as a company, managing it as a CEO?

It depends on how many we wind up selling versus how much you know our partners (sell). If our partners get galvanized.

We’ll have a decent size business. There is no question in Surface. Whether we have a decent size business or better than that will depend on kind of how galvanized our partners really get around the Windows 8 opportunity.

So who made the final call and when did you make it?

I know there is a desire to paint things dramatically. But of course there is many decisions. There is the decision to start. There is decisions to proceed. There is decisions to make commitments to hardware partners, to suppliers. There is the decision to make an announcement. There are various people involved.

Obviously starting was a big thing. Starting was a big thing. But the Windows team – the Surface team- we had got kind of ‘A’ people involved. It has been a small team relatively that has been involved. Obviously we ran the program with a lot of kind of privacy and secrecy in order to really have a chance to do it right. So not a lot of people involved really. The Surface guys themselves. Steven Sinofsky. The Windows team basically was mostly in the dark with just a couple of exceptions. Me. The board obviously knew what we were doing.

When did they start developing it? It was a while ago. I don’t think I want to go through that. Three to six months ago? A year ago? A long time ago?

It takes a while to do stuff. I am not going to say anything more than that. It takes a while.