Speaking at Oxford’s Saïd Business School yesterday, Ballmer said he had to make the crucial decision with the board about the £4.6bn acquisition "in the context of me not being around forever".
He said: "It’s important because the name of the company is Micro…soft. Software was a fundamental part of the founding principles."
Ballmer explained that the company’s origins as a software company have been transformed by the arrival of the Xbox console and the Surface tablet, and now the acquisition of Nokia.
He said: "We now have a profile that will end up being far more mixed in the future and that is a pretty fundamental change to the way we sell, identify ourselves, think, and express our values and innovation."
Ballmer said the Nokia acquisition would be the only "non-people" decision he would put on the list of toughest decisions, because all the others on the list were based around the firing and promoting of people.
In the Q&A session, Ballmer also admitted that despite Nokia’s acquisition being such a tough decision, with "20-20 hindsight" his biggest regret as boss was not putting the "hardware and software together soon enough".