Microsoft's five-billion-buck IoT R&D plan is just business as usual

It’s not new money and not a huge slab of Redmond's research budget

Microsoft’s announced it will spend $US5 billion on internet of things research over the next four years. But don’t get too excited: they are diverted dollars rather than a new cash splash

Redmond’s announcement explains the money will go towards “securing IoT, creating development tools and intelligent services for IoT and the edge, and investments to grow our partner ecosystem.”

“Customers and partners can expect new products and services, offerings, resources and programs.”

Five billion bucks is a lot of money. But not quite so impressive once you realise that Microsoft spent $13.0bn on R&D in FY 2017 and $12bn in each of FY 16 and 15. Five billion spread across the next four years may well be less than ten per cent of all R&D spend.

Further, we are pretty sure that this isn’t new money.

When The Register learned of the new investment we asked Microsoft if the $5bn was net new spend.

Redmond’s response said “This investment includes planned resource in hiring, research and product development, partner enablement and training and infrastructure investments.”

“This signals Microsoft’s continued commitment to digital transformation and the Internet of Things.”

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Which sure doesn’t sound like an increase in overall R&D spend.

It’s also not as if an organisation like Microsoft wouldn’t invest in IoT R&D. The field is a massive opportunity that the company would be negligent to ignore. And let’s not get all misty-eyed about R&D representing high boffinry: the admission this is about products and partnerships tells us this is just the work Microsoft’s gotta do to be a player.

So while it is lovely that Microsoft’s going to do lots of work in IoT – especially the security side of things – it doesn’t look like the company is going out of its way to spend on IoT R&D.

We also asked Microsoft what research areas have been made lower priority to enable the IoT focus. The company did not respond to that question. ®

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