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Microsoft to Spend $9.5 Billion on Research in 2010

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Much of Microsoft's investments center around "cloud" services, or online computing provided to users from hosted data centers. "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," Turner said

However, Turner said Microsoft will still have a significant on-premise software business. Microsoft has come under increasing pressure from companies such as Google that sell office productivity suites that are entirely online rather than installed on PCs

Microsoft plans to spend $9.5 billion on research and development this year

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