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This is the third installment of our exclusive interview last week with Microsoft CEO Steve Ballmer . In the first article we showed an overview and video footage of the main subject areas we covered: Big Opportunities, Operating Systems/Browsers, Mobile, Search and Developers. In the second post we did a deeper dive on his thoughts on big business opportunities for Microsoft in the next 5 – 10 years. Here we focus on his thoughts on the competitive landscape around operating systems and browsers. And Ballmer has lots to say on the subject. Particularly because Microsoft has fresh browser and OS products in the pipe: IE8 launched earlier this year and Windows 7 launches on October 22. We jumped right into the conversation by bringing up the 2001 consent decree with the Department of Justice and various other governmental bodies that, among other things, prohibited Microsoft from bundling Windows and IE for competitive purposes. But the landscape has changed a lot in the last eight years. And Microsoft’s competitors are doing exactly what Microsoft is prohibited from doing – bundling an operating system and a browser. Heck, Google didn’t even change the brands . Chrome is both a browser and a desktop operating system. Ballmer says the notion of an operating system being distinguished from the browser is no longer sensible: I’ll say that it is certainly clear that in the year 2009, the notion of operating systems being independent of internet access and internet ability to render important things …

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