Microsoft Corp chief executive Steve Ballmer has signalled a new direction for the world’s largest software company, pointing to hardware and online services as its future, taking a page from long-time rival Apple Inc.
Ballmer’s comments in his annual letter to shareholders published on Tuesday suggested that Microsoft may eventually make its own phones to build on its forthcoming own-brand Surface tablet PC and market-leading Xbox gaming console.

“There will be times when we build specific devices for specific purposes, as we have chosen to do with Xbox and the recently announced Microsoft Surface,” wrote Ballmer.

The new approach mimics Apple Inc, whose massively successful iPhone and iPad demonstrated tight integration of high-quality software and hardware and made Windows devices feel clunky in comparison.

Bonus clipped

Alongside the shareholders’ letter, Microsoft’s annual proxy filing, showed that Ballmer, got a lower bonus than he did last year, partly for flat sales of Windows and his failure to ensure that the company provided a choice of browser to some European customers.

He earned a bonus of $620,000 for Microsoft’s 2012 fiscal year, which ended in June, down 9% from the year before.

His salary, which is low by US standards for chief executives, remained essentially flat at $685,000.