Microsoft pledges £3.3bn to R&D

Daily Newsletters

Sign up to ZDNet UK's daily newsletter.

NEWS
Microsoft plans to increase its research and development budget by 20 percent and hire 5,000 new workers in the coming year, Chairman Bill Gates said on Thursday. Gates, speaking at Microsoft's annual meeting with financial analysts at its Redmond, Wash., headquarters, said the company's R&D budget will grow from $4.3bn (£2.7bn) last year to $5.2bn (£3.3bn) in fiscal 2003, despite the stagnant economy. "Because of our optimism (over) what the software can do in the decade ahead, we are increasing our investments," Gates said. Microsoft's employee base is "50,000 strong and growing," he said. Gates also said that Microsoft's biggest competitors are IBM and Linux, as the company attempts to establish its .Net software architecture. On the operating system front, Jim Allchin, group vice president at Microsoft, said Windows XP has now sold more than 46 million copies in the nine months since its release, making it the fastest-selling version of Windows ever. Microsoft says that XP has sold 230 percent more copies than Windows 95 and 160 percent more than Windows 98 for the same time period after their debut. Last week, Microsoft reported that its revenue rose 10 percent in the fourth quarter, to $7.25bn, up from $6.58bn a year earlier, in part due to increased sales of Windows XP and a new, somewhat controversial, corporate licensing plan. Allchin said Microsoft will release new versions of Windows XP for a variety of devices later this year: a Tablet PC version for tablet devices and laptops; an entertainment version called Windows Media Center for hybrid TV and PCs, and Windows Power Smart Display for a flat-panel PC that acts as a remote control or window to your regular PC. The next major release of Windows, code-named Longhorn, is in development, Gates said. Longhorn is expected to be unveiled late next year or early in 2004. Along with Longhorn will come new releases of Office, Visual Studio.Net , Exchange, MSN and other business software, Gates said. Many of those products will include built-in workflow features for routing documents and data, and the ability to read and understand Extensible Markup Language, Gates said. The company expects to spend $200m marketing and advertising its server software products this year, said senior vice president Paul Flessner. On the drawing board
Gates also demonstrated forthcoming technology that will allow computer users to send complaints and comments about Microsoft products to the company's managers. In a future update to Microsoft Office, for example, users will be able to click an icon and send a quick comment to Microsoft on a bug or a problem. The user will then be directed to a Microsoft discussion page on the topic that lists similar complaints by other users and responses from Microsoft. Product managers will be able to view a list of the top complaints about their products. Gates said that in order to find profitable new markets, Microsoft is willing to take a chance on unproven technology, as it has done in the past. "We're willing to take risks certainly. We have had many products that have not done as well as other products. We have technologies that have not proven out," he said. "There are things we got into earlier than we needed to, (like) interactive TV," Gates said. "Ten years ago, I said it was important. Today, I say, it's important? How much money did we make? Some big negative number. "We often will be ahead of things in that way," he added. On Wednesday, Microsoft held a daylong conference and presented its plans for its .Net architecture. Gates acknowledged that .Net has been slow to catch on, and he laid out an agenda to move the software strategy ahead. Gates added that he and Microsoft chief executive Steve Ballmer do not receive stock options. "We have never taken options. (We have) no conflict of interest," he said. " Our interests are overwhelmingly the same as (our) shareholders (interests)." On the legal front, Gates said he was hopeful that the company's 4-year-old antitrust case would soon come to an end. "We await that and it's significant for the customer," he said. Ballmer said the company is ready to put its legal issues behind it, promising that the company will compete fairly in the future. "We know we have to be more open, even more respectful to meet the demands and interest of our partners and customers as it relates to platform leadership," Ballmer said. Microsoft Chief Financial Officer John Connors said Microsoft's accounting practices are sound and won't face the accounting scandals that have hit Enron and Worldcom. "We take seriously the financial integrity of this company. You have our word, you will not see us in the articles in the future," he said, referring to news articles on Enron and Worldcom. Connors also predicted that the company's revenue will grow 11 percent to 13 percent during the 2003 fiscal year, with revenue growth in each product category. He predicted Microsoft will see 7 percent to 8 percent growth in its Windows business, 20 percent to 26 percent growth in the "home and entertainment" business, which includes Xbox; and about 75 percent to 90 percent increase in sales of its "business solutions," which includes Microsoft's customer relationship management software and bCentral Web site for small businesses. As "we go into fiscal year '03, we're outperforming the majority of those we compare ourselves to," Connors said. News.com's Mike Ricciuti contributed to this report.
ZDNet UK's Developer News Section delivers the latest headlines together with the best UK jobs, right to your browser. Have your say on all developer topics. From j2ee, to C++, from Visual Basic to Javascript plus much more. Share your experience with others on the Developers Forum. Let the editors know what you think in the Mailroom.

Post your comment

In order to post a comment you need to be registered and logged in.

You can also log in with Facebook. Log in or create your ZDNet UK account below

  • Login

Will not be displayed with your comment

By signing up for this service, you indicate that you agree to our Terms and Conditions and have read and understood our Privacy Policy. Questions about membership? Find the answers in the Community FAQ

Get ZDNet UK's daily newsletter

Enter your email address to sign up

ZDNet UK Live

TerryRK

Well it seems there is something a number of us agree on. Why is the Ubuntu Unity launcher so ugly? I thought perhaps it was something to do with...

4 hours ago by TerryRK on A tale of two distros: Ubuntu and Linux Mint
Freebies202

Duplicate comments are not made intentionally. Its very good to know that now you are keeping check on this problem because sometimes a commenter...

13 hours ago by Freebies202 on Microsoft fixes blog comments, speeds up blogs with open source
kevinmchapman

"the very significant number of users" and "many (most) of us" - you have no evidence for these statements. It is a fact that most users are saying...

21 hours ago by kevinmchapman on A tale of two distros: Ubuntu and Linux Mint
Marg Menzies Harrison

Another grammar faux pas is the improper use of "you". When sitting down down in a restaurant, for example, I get cringe when the waitress...

23 hours ago by Marg Menzies Harrison via Facebook on 10 flagrant grammar mistakes that make you look stupid
zdnetukuser

And NOW, folks, for Canonical's next trick... Kubuntu is late. Here's a pencil. Draw your own conclusions. cf.:...

23 hours ago by zdnetukuser on Linux Minterface
Moley

@kevinmchapman. The discussion here reflects the very significant number of users who really do like the traditional menu system and who wish to...

1 day ago by Moley on A tale of two distros: Ubuntu and Linux Mint
kevinmchapman

Er, no... It is an efficient means of finding the application/file/setting you need in one place. The icons are a simply a fallback for when you...

1 day ago by kevinmchapman on A tale of two distros: Ubuntu and Linux Mint
TerryRK

Isn't the provision of a text based search an admission by the developers that the mass of icons approach does not work? I don't need to use a...

1 day ago by TerryRK on A tale of two distros: Ubuntu and Linux Mint
kevinmchapman

"Unity and GNOME 3 both abandon the old text-based cascading menus in favour of a graphical icon-driven system." Point truly missed. Both use a...

1 day ago by kevinmchapman on A tale of two distros: Ubuntu and Linux Mint
TerryRK

whs001 - Thank you, I'm glad you liked the article. I absolutely agree with you on your first point. I should perhaps have made it clearer that...

1 day ago by TerryRK on A tale of two distros: Ubuntu and Linux Mint
Dennis Nilsson

If we allow corporate interest to dictate the way our government circumvents due process against foreign entities then we should accept the same...

1 day ago by Dennis Nilsson via Facebook on ACTA stumbles in Germany
GHar123

I totally dislike pirating of works, I fear that artists will be deterred from creating works if they think that they are going to get ripped off....

1 day ago by GHar123 on ACTA stumbles in Germany
JCB33

How dare film makers, artists or anybody that invests in creativity stop us pirating their works for free. I want to be able to walk into my local...

2 days ago by JCB33 on ACTA stumbles in Germany
Moley

@GrueMaster. I prefer horses for courses rather than one size fits all. I, and I suspect most other computer users, do not really wish to have...

2 days ago by Moley on A tale of two distros: Ubuntu and Linux Mint
greycynic

The product that scares me every time I have to use it is the Office 2007 version of Excel. The first bug that I found was applying the median...

2 days ago by greycynic on Ten flawed products that derail productivity
GrueMaster

Nice review and very informative. One thing I'd like to add (in reply to whs001's 1st question), the main reason to have the same interface from...

2 days ago by GrueMaster on A tale of two distros: Ubuntu and Linux Mint
Frederick Wrigley

I'be been using Mint 12 since the RC came out, and I am far more happy with the Cinnamon, the Mate, and, yes (with extensions), theGnome 3...

2 days ago by Frederick Wrigley via Facebook on A tale of two distros: Ubuntu and Linux Mint
bdantas

Excellent article. One small correction, though--although a fresh installation of Linux Mint 12 will, indeed, provide the user with a version of...

2 days ago by bdantas on A tale of two distros: Ubuntu and Linux Mint
Alan Ralph

In related news, the ISPs club together to get the members of the Home Affairs Select Committee (ya goofed on that part, ZDNet UK) copies of "The...

2 days ago by Alan Ralph via Facebook on MPs urge ISPs to take down terrorist material
Alan Ralph

In related news, the ISPs club together to get the members of the Home Affairs Select Committee (ya goofed on that part, ZDNet UK) copies of "The...

2 days ago by Alan Ralph via Facebook on MPs urge ISPs to take down terrorist material