While it's no secret that Microsoft has been quietly cobbling together the pieces of a VoIP strategy for several months, CEO Steve Ballmer finally tied it all together at a company conference in Japan on Monday: the company will formally enter the market early next year by incorporating the Web phoning technology with its operating system.

According to media reports, Ballmer said Microsoft's VoIP rollout, which would include videoconferencing as well as VoIP, will be combined with e-mail, video and instant messaging technologies. The ambitious deployment would not only be a part of its operating system, but also be incorporated in desktop applications and server software.

The firm made its first major move in VoIP in August of 2005 when it acquired VoIP start-up Teleo. Its products let users of Microsoft Outlook and Internet Explorer make phone calls by clicking on phone numbers. Since then, Microsoft has gradually been adding pieces of VoIP technology.

Microsoft is in the process of releasing its Vista operating system, Office 2007 productivity software, and important updates to its server software.

While details of the VoIP rollout are still sketchy, Ballmer was clear about Microsoft's intention to enter the market. "We are going to enter the voice over IP market the beginning of next year," he said.