The new Office software will utilize Windows 8, which means that it will integrate touch capabilities. Users, however, will also be able to use a traditional keyboard if they prefer.
Social is also a key part of the new Office software.
"The way we work today is dramatically different from the way we worked when I first started at Microsoft," Ballmer said. "People work in much more social and collaborative ways than ever before."
Microsoft is incorporating its recent acquisitions Yammer and Skype, plus Facebook , LinkedIn and other features into the software.
One new feature is a "people card" feature that allows users to view contact information as well as make a phone call to them via Skype. This is the first time Skype has been directly integrated into Office.
There will also be a feed that combines all of a user's social media feeds, allowing them access to all of their social media content in one place.
Kirk Koenigsbauer, corporate vice president of the Office division, also spoke at the news conference and mentioned Microsoft's recent purchase of Perceptive Pixel, which is a developer and producer of multi-touch display screens.
Koenigsbauer used a screen developed by Perceptive Pixel to demonstrate how the new software would allow users to collaborate in an interactive meeting.