Microsoft to boost mainland research unit

PUBLISHED : Saturday, 26 May, 2007, 12:00am
UPDATED : Saturday, 26 May, 2007, 12:00am

Microsoft Corp plans to boost its mainland research and development staff with about 1,200 people this year at an estimated cost of US$60 million, and it has bought land to set up corporate campuses in Beijing and Shanghai.

Microsoft, which has about 3,000 employees on the mainland, last year invested about US$150 million 'in just people costs' in the country, said corporate vice-president Zhang Yaqin, the company's head of mainland research and development operations. 'This year, we're going to add probably 40 per cent in people.'

Mr Zhang's comments follow remarks by Microsoft chairman Bill Gates on the US software giant's plans for expansion on the mainland when he addressed the Boao Forum for Asia in Hainan last month.

Much of the new spending will be on Microsoft's mobility software, including web services, digital entertainment and media applications for mobile telephones.

'China is the largest mobile market and more than 50 per cent of our customers are in the Greater China region, so it makes sense for us to invest a lot more in China in the mobile area,' Mr Zhang said.

Microsoft bought land in Beijing and Shanghai recently on which it plans to set up employee campuses similar to its California headquarters and move staff to these facilities over the coming years.

'We will have the capacity, which will be built over two to three years, for 8,000 people,' Mr Zhang said.

While Microsoft may not move R&D projects from the US to China, many of its new products are being created on the mainland. 'China is probably the fastest-growing country in terms of R&D. In China, we focus on new areas such as mobility, entertainment and some WAP (wireless application protocol) technology.'

Microsoft and Lenovo Group last month announced they would jointly develop software applications and mobile devices and technologies.

Playing catch-up with competitors in the web search and advertising areas is another focus for Microsoft's mainland operations. 'Obviously we have made mistakes in search and advertising as a company. We recognise we are way behind some of the platforms and are beginning to invest a lot more resources than ever before,' Mr Zhang said.

He said since late 2005, Microsoft had changed its strategy and organisation in these areas and added more people, channelling some of its brightest talent into helping the firm catch up with rivals.

Microsoft last year struck a deal with Beijing to support innovation in the country's information-technology and software firms and help close the digital divide between the developed and rural areas.