May 31, 2006, 4:09 PM — Microsoft Corp. Chief Executive Officer Steve Ballmer Wednesday defended Microsoft's plan to boost its R&D (research and development budget) for next year to Wall Street analysts who worry the increased investment will lower earnings potential and mean less return to shareholders.
Microsoft right now is preparing for two major product launches -- Windows Vista and Office 2007 -- while trying to gain footholds in nontraditional markets for the company such as Web-based services, security, storage and business intelligence, Ballmer said in a speech to analysts at the Sanford C. Bernstein Strategic Decisions Conference. It is crucial Microsoft to continue to invest in all of these areas because as it has proven in the past, the investment will pay off in the long term, he said.
"If you believe in the opportunity we believe in you have to invest behind it," Ballmer said. "You have to be optimistic about your opportunity to change the world. ...This takes a long-term view. Everything about Microsoft takes a long-term view, I
