Ballmer has told Wall Street Analysts that the chances of a tie-up with rival Yahoo are negligible, but that the internet is still a major part of the software giant's plans.
"There's nothing under discussion between the two of us," said Ballmer.
"We had a set of principles, we talked about them, it didn't work out. Fine, we're done. We can move on.
New internet opportunity
"There is this huge, huge, huge new opportunity around the Internet and online and we have to embrace that opportunity and invest in that opportunity," Ballmer added.
Microsoft has lagged far behind industry leader Google, and its original bid for Yahoo was with the intent to wrest some of the market back under its control.
But despite boardroom shifts at Yahoo, it appears increasingly unlikely that Microsoft will keep on trying to buy into the company.
Ballmer's assertion that the internet is still central to Microsoft's investment plans suggests that the company may now focus elsewhere - with rumours growing that an increased arrangement with Facebook is on the cards.
Microsoft already owns 1.6 per cent of the popular social networking site, and has an exclusive deal to sell adverts on the site.