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While Apple may turn a profit on the highly-anticipated device, Ballmer indicated that he believed its sales would be conservative. 'It's a $500 subsidized item,' he said. 'They may make a lot of money.

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But if you actually take a look at the 1.3 billion phones that get sold, I'd prefer to have our software in 60% or 70% or 80% of them, than I would to have 2% or 3%, which is what Apple might get.

However, he was more forgiving when talking about Apple's domination of the market for digital music downloads. Crediting Jobs with spotting a trend before it fully developed, he acknowledged that Apple 'did a nice job'.

He then positioned the Zune in a very different market to the iPod. 'I'll bet our ads will be less edgy,' he said. 'But my 85-year-old uncle probably will never own an iPod, and I hope we'll get him to own a Zune.'

The full interview, in which Ballmer talks about life at the top of the world's largest software development house, can be found on USA Today.