Software companies set to follow US firm’s Cambridge move

Microsoft’s decision this week to invest £50m in a new research laboratory in Cambridge and to set up a venture capital fund to encourage small software companies could see firms rushing to set up near the US company.

It could also result in an influx of IT specialists to the UK, which is facing a skills shortage.

Anthony Parish, director general of the Federation of the Electronics Industry, said Microsoft’s move was `extremely positive news for the UK electronics industry’. Although only 40 jobs will be created directly, it could attract similar investments from other high-tech companies, he said. `If successful it could lead to an overflow into product development which will spawn a far greater number of jobs.’

He also foresees significant growth opportunities from Microsoft’s establishment of a venture capital fund to help small software businesses.

The research centre – to investigate and anticipate future technologies – is to be set up in collaboration with Cambridge University. Roger Needham, its deputy head and professor of computing, has been appointed as the laboratory’s director.

The new laboratory is on the doorstep of Microsoft’s rival, Oracle, which jointly funds a computing lab in Cambridge with Olivetti.

Oracle is committed to putting in £2m a year, and the Oracle and Olivetti Research Laboratory has attracted £40m of investment to the area.

The Microsoft investment comes a week after Cypress Technologies opened one of the largest new microchip design centres in the UK in Basingstoke.

Dan Barrett, its vice-president sales and marketing, warns in an interview in The Engineer this week that `we will only be limited by our ability to hire properly trained people’.

Cypress takes root, page 15