"It truly is a new era at Microsoft ...This is a significant shift, both in what we do and how we see ourselves as a devices and services company," Big Steve said.

What that means is MS is focused on hardware augmented by Cloud. That includes both consumer products and those built for businesses, with a significant overlap that Ballmer hopes will leverage the BYOD movement to promote the use of personal devices in enterprise networks.

"Fantastic devices and services for end users will drive our enterprise businesses forward given the increasing influence employees have in the technology they use at work a trend commonly referred to as the Consumerisation of IT," he said in the letter.

In defining the new Microsoft to shareholders, Ballmer also said the company will embrace new form factors for devices such as the Surface tablet/PC, but doesn't say whether that means the rumoured Windows 8 Phone handset. But he emphasised tying services to all types of hardware is key.