Microsoft spent almost three times as much on R&D as Apple last year


Microsoft's research facilities around the world.

Microsoft is among the technology leaders in research and development, having spent $9.8 billion in the category for its fiscal 2012 year. Its primary competitor isn't exactly in the same ballpark – Apple spent $3.4 billion on R&D for its fiscal 2012 year.

According to Microsoft's financial review, the company's R&D costs have steadily increased over the years. For its fiscal 2011 year, for instance, it spent $9 billion on the category, and in fiscal 2010 it spent $8.7 billion. As pointed out by The Next Web, Microsoft is on track to spend about $10 billion next year.

While the amount spent on research by Apple may be dwarfed by Microsoft's spending on the category, it's actually a significant step-up from previous years.

Microsoft's rival spent $1 billion more – or nearly a third – than its previous fiscal year, as it spent $2.4 billion in its 2011 fiscal year. According to its three-year financial history, Apple spent just $1.8 billion on R&D in the fiscal 2010 year. The $1 billion year-over-year increase is the largest in Apple's history, the company's financial review noted.

For Apple, the increase in spending may represent the start of a new era. Steve Jobs was famously against spending much time on consumer research, saying it played almost no role in what products Apple would make.

"It isn't the consumers' job to know what they want," Jobs once stated when asked how much consumer research went into the iPad.

Via: The Next Web
Source: MicrosoftApple | Image via Microsoft

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41 Comments

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You obviously can't buy innovation (although MS tries to when they buy out companies) ... Some simply have vision and some don't

MS envision a future of tightly integrated systems and seamless interaction between devices and software and if youve seen some of the concept videos of it all youd be amazed and i think windows 8 using the modern UI between desktop mobile and table is a step in the direction they want it to take. Unlike apple who dont do anything that useful with there money and only put money into R&D to increase there own profits MS are looking prolly 10 years in the future

Microsoft spends the R&D money on technological research. Apple spends it on psychological research, to get people to believe it's classy to overpay for things.

Microsoft needs you to buy 2 maybe 3 copies of Windows 8 Pro (even if you don't use them) just to help fund their R&D next year!

Apple actually bring their products to market. How many tablets did MS have lying around before they released the surface after Apple basically created the market?

MS also had the surface table or whatever it was in developed long before the iPhone was released. They just failed to see what they could use the technology for, and this is something basically all other technology companies other than Google and Apple have failed to do time and time again.

I believe (from reading Steve Jobs autobiography) that Toshiba was showing Apple some new products they had created, which included a really small hard drive that 'they had no idea what to use it for'. Apple snapped up an exclusivity aggrement and started making iPod's.

DomZ said,
Apple actually bring their products to market. How many tablets did MS have lying around before they released the surface after Apple basically created the market?

MS also had the surface table or whatever it was in developed long before the iPhone was released. They just failed to see what they could use the technology for, and this is something basically all other technology companies other than Google and Apple have failed to do time and time again.

I believe (from reading Steve Jobs autobiography) that Toshiba was showing Apple some new products they had created, which included a really small hard drive that 'they had no idea what to use it for'. Apple snapped up an exclusivity aggrement and started making iPod's.

You believe everything you read in that autobiography?
Wanna buy a bridge? Cheap!

ahhell said,
Patent trolling must be expensive.

Good point, how much did the respective companies spend on lawyers etc?

greenwizard88 said,
Half of this article is about Apple. How about what Microsoft actually does with their 10b in research?

Nobody cares, obviously this article wants to take that spin.

More clicks.

GS:mac

Glassed Silver said,

Nobody cares, obviously this article wants to take that spin.

More clicks.

GS:mac


The article is about the news of numbers that were just released by both companies. It's not a feature story. Your assumption is incorrect.

Anthony Tosie said,

The article is about the news of numbers that were just released by both companies. It's not a feature story. Your assumption is incorrect.

Read the article for a second time and this time without thinking too much about the comparison.

You're right, the article is perfectly sensibly written and anyone, including me, getting wound up about it should take another look at it and don't run foolishly around and cry.

I apologize for judging too quick.

GS:mac

Why would apple have to spend money on research? Every year they just sit in a room and say "Ok so the screen will be 1 inch bigger and make the device .4 inches thinner and the sheep will flock". Their R&D money is probably just coffee and donuts while they sit around pretending to work.

Colin McGregor said,
Why would apple have to spend money on research? Every year they just sit in a room and say "Ok so the screen will be 1 inch bigger and make the device .4 inches thinner and the sheep will flock". Their R&D money is probably just coffee and donuts while they sit around pretending to work.

LOL. I was wondering the same thing. Apple doesn't release anything from their R&D. I'm surprised they even have one... I would love to know what goes on in there...

trimphil said,
Looks like Apple knows better how to spend money

for short term you might be right but not for long term. Openness of MS is both good and bad. the only problem MS has is that they develop some really cool things in their labs yet they don't get full credit of what they are doing. apparent example is the speech engine that microsoft were pioneer yet apple got the credit with siri. or the panorama app with Photosynth and yet new android feature for their camera called "photo Sphere" and get the credit. they are just too busy creating not using their own stuff. the only thing they used and were a huge success with no doubt was kinect for XBox and in my opinion that is the biggest competitive advantage they have over nintendo or Playstation.

trimphil said,
Looks like Apple knows better how to spend money

And one knows how to innovate... Hint, we're talking about two different companies... lol

S3P€hR said,

for short term you might be right but not for long term. Openness of MS is both good and bad. the only problem MS has is that they develop some really cool things in their labs yet they don't get full credit of what they are doing. apparent example is the speech engine that microsoft were pioneer yet apple got the credit with siri. or the panorama app with Photosynth and yet new android feature for their camera called "photo Sphere" and get the credit. they are just too busy creating not using their own stuff. the only thing they used and were a huge success with no doubt was kinect for XBox and in my opinion that is the biggest competitive advantage they have over nintendo or Playstation.

Don't forget Apple's cloud services--brought to you by Microsoft.

Microsoft has actually been trying to innovate and break new ground in the market.

Apple has just been re-releasing the same products from 2009 over and over with minor cosmetic changes and calling them new models.

Lord Method Man said,
Microsoft has actually been trying to innovate and break new ground in the market.

Microsoft pretty much lost all the ground they had in the mobile space because they failed to innovate and anticipate. Apple had their revolution in 2007 and they've been steadily improving upon that. Microsoft will most likely do the same with their Metro line of products for the years to come. Expecting companies to do a major shift every few years is completely unrealistic. On top of that the vast majority of users really doesn't care much for having to relearn everything on a frequent basis.

Edited by .Neo, Nov 1 2012, 4:58pm :

This just GOES TO SHOW that you can't capture the people's imagination, you can't create the perfect blend of simplicity and functionality, by just throwing money at the problem. Apple will spend less and sell more (mobile and pad devices). You've got to have smart leaders with VISION and I'm not sure the ones at MS are smart enough, considering what they did to the desktop, when they talk about the TELEMETRY based design decisions.

a1ien said,
This just GOES TO SHOW that you can't capture the people's imagination, you can't create the perfect blend of simplicity and functionality, by just throwing money at the problem. Apple will spends less and sell more (mobile and pad devices). You've got to have smart leaders with VISION and I'm not sure the ones at MS are smart enough, considering what they did to the desktop, when they talk about the TELEMETRY based design decisions.

No, it just means that MS are targeting more markets with a larger range of products.

wrong.

Apple spend all their money on advertising and massive shop floors and replacing broken apple fail devices. This is why they are successful.

Everyone else creates new innovations, Apple just copy, rebrand, and advertise it as their own convincing people they innovate along the way.

Case in point: apparently they've suddenly decided earphones shouldn't be round...who knew!!

dotslash said,
Apple spend all their money on advertising and massive shop floors and replacing broken apple fail devices. This is why they are successful.

Apple's devices actually have pretty low failure rates, if that's what you mean. If you mean some issues with products like Maps, then I think that's more subjective.

a1ien said,
This just GOES TO SHOW that you can't capture the people's imagination, you can't create the perfect blend of simplicity and functionality, by just throwing money at the problem. Apple will spend less and sell more (mobile and pad devices). You've got to have smart leaders with VISION and I'm not sure the ones at MS are smart enough, considering what they did to the desktop, when they talk about the TELEMETRY based design decisions.

you are absolutely clueless. you think all they research is how to make windows? complete and utter lack of understanding of what research in any field is all about.

Anthony Tosie said,

Apple's devices actually have pretty low failure rates, if that's what you mean. If you mean some issues with products like Maps, then I think that's more subjective.

My 3GS was replaced twice and 4S just two months ago because of defects. Customer service is top notch though when it does go wrong.

a1ien said,
This just GOES TO SHOW that you can't capture the people's imagination, you can't create the perfect blend of simplicity and functionality, by just throwing money at the problem. Apple will spend less and sell more (mobile and pad devices). You've got to have smart leaders with VISION and I'm not sure the ones at MS are smart enough, considering what they did to the desktop, when they talk about the TELEMETRY based design decisions.
Do you know how ignorant you sound? Do you even know the scope of either Microsoft or Apple's R&D? Microsoft does way more R&D and for a broader range of things. How about you educate yourself first before talking out of your ass?

dotslash said,
wrong.

Apple spend all their money on advertising and massive shop floors and replacing broken apple fail devices. This is why they are successful.

Apple's advertising budget for 2012 was: $933 million
Microsoft's advertising budget for 2012 was: $1.9 billion

[url=http://www.wolframalpha.com/in...+vs+Microsoft+revenue]Apple did twice the sales volume (revenue) that Microsoft does[/url]. Apple also takes [url=http://www.wolframalpha.com/in...+vs+Microsoft+profit]nearly three times more profit than microsoft does[/url]. Despite the fact that [url=http://www.wolframalpha.com/in...Microsoft+total+value]Apple is worth more than twice as much as Microsoft[/url], doing twice the sales volume, and making >twice the profit [url=http://www.forbes.com/sites/yc...-quantity/]Microsoft's advertising budget is almost double Apple's (and nearly 3x more as a percentage of profit)[/url].

You're about as spectacularly wrong as it's possible to be.

Anthony Tosie said,

Apple's devices actually have pretty low failure rates, if that's what you mean. If you mean some issues with products like Maps, then I think that's more subjective.

Apple devices are by far the most fragile smartphones out there from my personal experience.

Gaffney said,

Apple devices are by far the most fragile smartphones out there from my personal experience.

I don't doubt you're experience, I'm just saying the studies on failure rates show Apple has one of the lowest in the industry for the majority of its products. (Its failure rate for the iPhone is actually among the lowest in the industry for smartphones, with some studies showing it has the lowest failure rate of all big-name smartphones.)

Anthony Tosie said,

I don't doubt you're experience, I'm just saying the studies on failure rates show Apple has one of the lowest in the industry for the majority of its products. (Its failure rate for the iPhone is actually among the lowest in the industry for smartphones, with some studies showing it has the lowest failure rate of all big-name smartphones.)

And your point is completely irrelevant. Nobody is saying that they fail, although you keep responding saying they have a low failure rate.

The point is that they are fragile. Dropping your phone isn't a failure of the device necessarily, and won't be represented in studies on "failure rates". But it's a real world issue.

rfirth said,

And your point is completely irrelevant. Nobody is saying that they fail, although you keep responding saying they have a low failure rate.

The point is that they are fragile. Dropping your phone isn't a failure of the device necessarily, and won't be represented in studies on "failure rates". But it's a real world issue.


They weren't irrelevant in the comment I was addressing. I said if dotslash's "broken app fail devices" was referring to failure rates (his phrasing doesn't really make it easy to understand) that Apple actually has one of the lowest rates.

I didn't disagree with anyone saying their devices break easy, I clarified that I was only referring to Apple's failure rates being low; nothing more, nothing less. As I said in my response to Gaffney that you quoted, I wasn't disagreeing with his experience.

Anthony Tosie said,

Apple's devices actually have pretty low failure rates, if that's what you mean. If you mean some issues with products like Maps, then I think that's more subjective.
There's no way in Hell the failure of that crappy Maps "application" could be considered subjective.