In an interview in the latest Fortune (registration required), Microsoft CEO Steve Ballmer laments Xbox 360 delays, admits Windows Mobile is a 'negligible player' (so far), and slams giant US provider and portal AOL for choosing Google over Microsoft in a fiercely contested media partnership deal. Such are the real-world challenges for the leader of the modern day Microsoft.

Yet there is one domain where Ballmer is undisputed master: "I've got my kids brainwashed. They don't use Google, and they don't use an iPod".

And not only are the Ballmer children towing the company line, they're getting Vista-ready too. Latest reports are that the new Windows will come with a made-over, iPod-hostile version of Media Player (Microsoft itself has neither confirmed or denied ... but it would put Vista at odds with the iPod-friendly Xbox 360).

Apple should be wary, too, that Ballmer still has envious eyes on its iPod. He tells Fortune: "In five years, are people really going to carry one device that is their communication device, one device that is music? There's going to be a lot of opportunities .... We want to be in that game .... Expect announcements from us in that area in the next 12 months."