4 ms·

Angry shareholders say Microsoft squanders billions on pointless R&D projects

7 points by nickb 18y ago

rm999 18y ago
I agree that Microsoft wastes resources on research. Normally, I love the idea of private companies funding research, but Microsoft has a habit of not using its research for anything commercial. Instead, they file for thousands of patents and just sit on them. I feel the same way about Google - by spending their vast profits on hiring more smart people than they need (instead of say, giving a dividend out to shareholders), they do a disservice to the entire industry. Smart engineers and researchers are relatively rare, and shouldn't be sitting in some research building writing up papers that will never produce a dollar - that's what Universities are for. Instead, they should be out there starting companies and heading the engineering teams at small to medium companies. It's almost tragic to the tech industry that Microsoft and Google are so profitable.
- snprbob86 18y ago
  "Microsoft has a habit of not using its research for anything commercial" Really? Looking at Wikipedia [1], I see at least 10 projects that have evolved into successful commercial endeavors. The most notable of which are in programming languages and graphics. I also know of at least a few hush, hush projects which are currently evolving into commercial products or features. Once again, I feel compelled to defend my slightly misguided employer. We try hard, we produce some great software and some crap software. The web only wants to remember the crap, but that's probably because you probably aren't a target customer for any of the great stuff. [1] http://en.wikipedia.org/wiki/Microsoft_Research#Research_projects http://en.wikipedia.org/wiki/Microsoft_Research#Research_pro...
  - pclark 18y ago
    > The web only wants to remember the crap, but that's probably because you probably aren't a target customer for any of the great stuff yeah, its our fault.
  - deleted 18y ago
    [deleted]
  - rm999 18y ago
    I do remember the good stuff MSR has done, but does it justify the cost? Microsoft has probably spent about half its current market capitalization on MSR (very rough estimate based on its budget for the last few years: 7-8 billion, and the fact that it has existed for 18 years. I think it's safe to assume that they have spent >75 billion on research since MSR's conception.) Even if half of this is justified (a generous estimate), Microsoft has lost a quarter of its value to useless research! This is not the norm at most companies. Normally, I think research is a great thing (I did research in grad school), but not the way MSR does. They take some of the brightest minds in the industry and have them work on "products" that never see the light of day, and then patent their papers. Microsoft engineers do most of the revenue generating work. C# could have been created outside of MSR.
    - snprbob86 18y ago
      "I do remember the good stuff MSR has done, but does it justify the cost?" Good question -- I don't know. "Microsoft has probably spent about half its current market capitalization on MSR" Whoa! Way off! My understanding is that normal software product develop counts as R&D for tax purposes.
      - rm999 18y ago
        "My understanding is that normal software product develop counts as R&D for tax purposes." Ah, that would explain a lot... I guess that's the D in R&D ;)
- trevelyan 18y ago
  >> that's what Universities are for. << Your point makes no sense. If there is no difference between the activities it hardly matters where someone does it.
  - rm999 18y ago
    Note that I am specifically talking about research "that will never produce a dollar." That was the whole point of the article - stock holders shouldn't be subsidizing research that has a ~0% chance of benefiting the company; a lot of MSR is devoted to this type of research. Universities tend to do a very good job of regulating their numbers in a specific field, but the billions of dollars Microsoft throws at research is throwing that off balance. If a researcher can't find a University position, there are tons of other jobs he can find. Normally, it can be argued that anything a company does makes things more efficient in a capitalist system. In this case, a lot of shareholders (and I) and arguing that what Microsoft is doing isn't.

7 points by nickb 18y ago

rm999 18y ago

I agree that Microsoft wastes resources on research. Normally, I love the idea of private companies funding research, but Microsoft has a habit of not using its research for anything commercial. Instead, they file for thousands of patents and just sit on them. I feel the same way about Google - by spending their vast profits on hiring more smart people than they need (instead of say, giving a dividend out to shareholders), they do a disservice to the entire industry. Smart engineers and researchers are relatively rare, and shouldn't be sitting in some research building writing up papers that will never produce a dollar - that's what Universities are for. Instead, they should be out there starting companies and heading the engineering teams at small to medium companies. It's almost tragic to the tech industry that Microsoft and Google are so profitable.

snprbob86 18y ago
"Microsoft has a habit of not using its research for anything commercial" Really? Looking at Wikipedia [1], I see at least 10 projects that have evolved into successful commercial endeavors. The most notable of which are in programming languages and graphics. I also know of at least a few hush, hush projects which are currently evolving into commercial products or features. Once again, I feel compelled to defend my slightly misguided employer. We try hard, we produce some great software and some crap software. The web only wants to remember the crap, but that's probably because you probably aren't a target customer for any of the great stuff. [1] http://en.wikipedia.org/wiki/Microsoft_Research#Research_projects http://en.wikipedia.org/wiki/Microsoft_Research#Research_pro...
- pclark 18y ago
  > The web only wants to remember the crap, but that's probably because you probably aren't a target customer for any of the great stuff yeah, its our fault.
- deleted 18y ago
  [deleted]
- rm999 18y ago
  I do remember the good stuff MSR has done, but does it justify the cost? Microsoft has probably spent about half its current market capitalization on MSR (very rough estimate based on its budget for the last few years: 7-8 billion, and the fact that it has existed for 18 years. I think it's safe to assume that they have spent >75 billion on research since MSR's conception.) Even if half of this is justified (a generous estimate), Microsoft has lost a quarter of its value to useless research! This is not the norm at most companies. Normally, I think research is a great thing (I did research in grad school), but not the way MSR does. They take some of the brightest minds in the industry and have them work on "products" that never see the light of day, and then patent their papers. Microsoft engineers do most of the revenue generating work. C# could have been created outside of MSR.
  - snprbob86 18y ago
    "I do remember the good stuff MSR has done, but does it justify the cost?" Good question -- I don't know. "Microsoft has probably spent about half its current market capitalization on MSR" Whoa! Way off! My understanding is that normal software product develop counts as R&D for tax purposes.
    - rm999 18y ago
      "My understanding is that normal software product develop counts as R&D for tax purposes." Ah, that would explain a lot... I guess that's the D in R&D ;)
trevelyan 18y ago
>> that's what Universities are for. << Your point makes no sense. If there is no difference between the activities it hardly matters where someone does it.
- rm999 18y ago
  Note that I am specifically talking about research "that will never produce a dollar." That was the whole point of the article - stock holders shouldn't be subsidizing research that has a ~0% chance of benefiting the company; a lot of MSR is devoted to this type of research. Universities tend to do a very good job of regulating their numbers in a specific field, but the billions of dollars Microsoft throws at research is throwing that off balance. If a researcher can't find a University position, there are tons of other jobs he can find. Normally, it can be argued that anything a company does makes things more efficient in a capitalist system. In this case, a lot of shareholders (and I) and arguing that what Microsoft is doing isn't.