Ballmer strongly hints at Office for iPad and Android tablets

He said Microsoft has its eyes wide open for opportunities to port products to non-Windows platforms

By , IDG News Service |  IT Management

They went over the company's strategy to transform itself from a provider of packaged, on-premises software to a provider of devices and cloud services. They said this process is underway and will be helped by the recently announced reorganization designed to make the company work in a more cohesive way, a restructuring that is being implemented.

Ballmer did specifically list four areas in which Microsoft must deliver in the coming years in order to succeed: Office 365 and the Azure cloud platform; Windows PCs; smartphones and tablets; and innovation in "high value" opportunities.

Office 365, the cloud suite of productivity, messaging and collaboration applications, is doing very well and is on a US$1.5 billion annual revenue run rate, officials said. It will be a vehicle for Microsoft to continue delivering other applications via the software-as-a-service (SaaS) model, Ballmer said.

Despite the cratering of the worldwide PC business, Microsoft must stick with it, because the PC will continue to be the device of choice for people when they need to be productive, as opposed to tablets, which are more content-consumption devices, according to Ballmer. He said he's confident Windows 8.1, due in mid-October, will offer "distinct improvements" over Windows 8.

CFO Amy Hood gave a peek at how Microsoft plans to do its financial reporting starting this quarter to match its corporate reorganization. As part of the restructuring, Microsoft dissolved its five business units -- the Business Division, which housed Office; Server & Tools, which included SQL Server and System Center; the Windows Division; Online Services, which included Bing; and Entertainment and Devices, whose main product was the Xbox console.

It has replaced them with four engineering groups organized by function, around operating systems, applications, cloud computing and devices, and by centralized groups for marketing, business development, strategy and research, finance, human resources, legal and operations.

Hood said the company will now report its financial performance according to five segments under two main categories:

The first category is Devices and Consumer and includes three segments:

-- hardware, which includes the Surface tablets and Xbox;

-- licensing, which includes Windows OEM sales, Windows Phone, Office for consumers and IP licensing;

-- "other," which includes Bing, MSN, Office 365 Home Premium, and video games

The second category is Commercial and includes two segments:

-- licensing, which includes Windows for the enterprise, server products, Office for businesses, Dynamics and unified communications products like Lync

-- "other," which includes enterprise services, Office 365 for businesses and Azure

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