Outgoing Microsoft CEO Steve Ballmer confirmed in an interview with The Seattle Times that Stephen Elop is not only on the shortlist for the top job but also hinted that he may have jumped a few notches up the ladder, stating, “Stephen will go from external [candidate] to internal.”

Well duh, we already knew this obviously, but it’s nice to know we were right. It would of course be unfair to expect Ballmer to know exactly where Elop stands in the race to be his successor. After all, he’s not on the committee charged with finding that person. Still, Elop is an Microsoft man and bringing him back within the fold would make his succession far more natural should chairman Bill Gates and his fellow committee members decide to take that route.

In the meantime, Elop has stepped down from his current job as CEO of Nokia in the wake of Microsoft’s acquisition of Nokia’s Devices & Services business for US$7.1-billion. The Redmond-based technology giant will pay Nokia a cool 3.79 billion euros ($4.99 billion) for the business, and 1.65 billion euros (US$2.18-billion) for its patent armory. Not a bad deal huh? This is what he brought to the table for Microsoft. He will merely a become the Executive VP of Devices & Services for now, and should join Microsoft once the acquisition deal is done and dusted.

A couple of his buddies from Nokia will be coming with namely Jo Harlow, Chris Weber, Juha Putkiranta and Timo Toikkanen are also jumping ship to Microsoft.

Gates, who as we all know is the founder and chairman of Microsoft who stepped aside as CEO in 2000, is serving on the special committee cobbled together to find a replacement for Ballmer. Succession planning at Microsoft for top execs began way back in 2010 already but preparations have jumped into overdrive since three to four months ago when Ballmer told the directors he wanted to quit the job.

Elop is actually a great choice for the top job, especially considering the market Microsoft is gunning for, Devices and Software. He knows them both, as mentioned he’s already shown his knowledge in the Devices landscape, but he is well acquainted with what runs them to, ie the software, particularly enterprise software. Oh yeah, did I forget to mention, if you didn’t already know he has been on the Microsoft team for a long time. Before becoming Nokia’s CEO, he worked in Redmond as the head of Microsoft’s Business Division, in charge of Microsoft’s beloved Office business.

So yeah… I think it’s safe to say he is top of the list.