The goal of the industry--and of Microsoft--should be to create devices that work for both home and work and are capable of handling running business applications, unified messaging and gaming.
"In a sense we have to think about the phone as almost a universal remote control for your life," Ballmer said.
Ballmer even conceded that the phone is taking on a more central role than the computer for many people.
"The phone has a unique role," he said. "While the PC is the most powerful device, the phone is most popular device." In a world of services (think Windows Live) that run over a variety of devices, it is the phone that any individual is most likely to have at any given time, he said.
In some cases, the phone will be the computer.
"In many countries the phone will be the PC for people that have very little money," he said, pointing to a scenario in which the phone plugs into a docking station and connects up to a keyboard and television to act as a PC-like device, something Microsoft has been developing in its labs and hopes to start testing over the next 12 months.
As I noticed earlier, the phone becomes a disruptor for the PC ( displacement would be a more precise term). There are several factors that help it: the moore's law, maturing communications infrastructure, and, of course, opening up of APIs ( see Apple's announcement earlier this month).
Ad social networking, and you get an incredible potential for growth.