Software giant Microsoft said Thursday that it would boost its annual research budget to US$6.8 billion while adding some 5,000 jobs, 3,500 of them in the US.
Microsoft chairman Bill Gates announced the plan at the company's annual financial analyst conference, saying that the increased funding would be devoted to the next generation operating system dubbed Longhorn -- a trial version of which is due out next year.
Microsoft would also concentrate on the development of collaboration programmes and Internet services, Gates said.
Gates delivered highlights of new Microsoft technological ventures, including its tablet PC, Microsoft watch, and designs for automotive manufacturers that will run Microsoft operating systems for voice recognition and other features in future car models.
"Our goal is to take R&D and drive it across all our products," Gates said.
Gates identified six initiatives that Microsoft would focus on to "empower" knowledge workers between this year and 2009. These include better desktop management, integrated storage, a new Windows file system, improved business intelligence, model-based programming, speech/language and software updating.
The increased investment in R&D represents an 8 percent increase over current levels and is also designed to enable better security for MS products, Gates said.
"We're just at the beginning of what we can do with software," he said. "The IT audience, developer, knowledge worker, the way business processes are done, the way people deal with info at home. With all those pieces, we've just started to surface what software can enable. We talk about that as software empowerment."