Microsoft will consider Irish expansion

Despite Ireland's position as a high cost economy, Microsoft is keeping its existing operations here and will consider further expansion, Microsoft chief executive Steve Ballmer said yesterday in Dublin.

"Our operations here have brought great value to the Microsoft corporation," he told reporters at a press briefing yesterday during a one-day visit, during which he spoke at a customer event and gave a lecture to students at Trinity College Dublin.

"We have almost a full-service Microsoft in Ireland," he said, noting its 1,200 employees span divisions ranging from research and development to customer support to product localisation.

"We couldn't be more delighted with the output here."

He said he knew Irish people were discussing many issues about the economy here, as they should be. "But if you come from outside, I'll tell you, things look pretty darn good in Ireland."

Microsoft's new research and development division in Dublin now has 30 of a projected 100 employees working on "core Windows development", about half Irish and half hired from abroad.

"We have very multicultural, multinational development teams."

Mr Ballmer said Ireland could be in line for further R&D expansion: "Can we, will we do more here? My guess is yes."

However, he added that the country is now "a full employment economy" and therefore "talent is scarce". Microsoft has stepped up its R&D operations in China and India for this reason - it's not about costs, he said, but about the availability of talent.

Costs are a more important factor on Microsoft's operations side but he added that Microsoft believed there was "a very competitive cost position in Ireland".

If the Government were to alter the 12.5 per cent corporation tax structure, Microsoft would need to take this into consideration. But Mr Ballmer said that the tax rate, though it might have "incentivised" companies to come to Ireland earlier, was not the only reason they stay.

He cited the education system, the availability of talent, the fact that the country forms a "tech bridge" to the US, and the fact that Ireland is an English-speaking economy as equally important.

Mr Ballmer said the company was "in the process of complying with the EU's order" for various sanctions after Microsoft lost an anti-trust suit brought by the European Commission.