Microsoft to spend $9.5B on R&D in 2010

With battles on multiple fronts--mobile, social, search--Microsoft has big plans for the future

Microsoft has plans to spend $9.5 billion on research and development in 2010

Speaking at the CeBIT trade show in Hannover, Germany, Microsoft COO Kevin Turner told the audience that the figure is $3 billion greater than the R&D spending of the next largest technology company. Much of this multi-billion dollar investment will be centered around improving software in the cloud.

"Especially in light of the tough difficult macroeconomic times that we're coming out of, we chose to really lean in and double down on our innovation," said Turner. "We're going to change and reinvent our company around leading in the cloud."

Microsoft may indeed need some serious reinvention. Today's news confirming Google's acquisition of DocVerse says a lot about how influential cloud computing has become. Google may find it easier now to transition some old Microsoft Office users to Google Docs.

According to CEO Steve Ballmer, 70% of the 40,000 people who work on software at Microsoft are working in the cloud. The heavyweight computer company has not ignored the trend to cloud computing over the past few years, and Ballmer noted that all Microsoft products--including Windows, Office, Xbox, Azure, Bing and Windows Mobile--are designed to be connected to the cloud.

Besides the cloud, Microsoft has big stakes in multiple wide-ranging sectors: mobile, social, and search.

Windows Phone Series 7, for example, is the latest version of Windows Mobile and will be competing directly with Apple's iPhone and Google Android, two of the biggest names right now in smartphones. As for search and social, the two grow closer everyday. Bing has a deal with Twitter to bring a social element to its search results, but Google, still the most widely used search engine, has the same deal.

Whether throwing a ton of money at R&D can help Microsoft cut down some of its top competitors remains to be seen.