Microsoft Korea to disband R&D unit

SEOUL - Microsoft Korea said Tuesday that its research and development workforce based in Korea will be dissolved by the end of next month.

With the Microsoft headquarters deciding late last year that the Asia R&D Center will be based in Beijing, the 21 R&D employees in Seoul were ordered to relocate, according to a Microsoft Korea official.

So far, 10 R&D workers based in its southern Seoul office have received calls to work at the US software giant's headquarters in Redmond, Washington. However, positions for the 11 others are still undecided with them having the option to work at another department in Seoul or transfer to the firm's support programs ? such as career consulting and recruitment.

None of them will be relocating to the Asia R&D Center in Beijing, said the official.

"The R&D team was an organisation that was under the US headquarters and it also had a direct report line to (Redmond)," said the Microsoft official. "We believe it will not have much of an impact in our operations here since it did not belong to the Korean branch in the first place."

The news breakout takes place as Microsoft is aiming to increase the competitiveness of its R&D centers by consolidating them into six across many different regions: Redmond, Beijing, Cambridge, Bangalore, Silicon Valley and New England.

The R&D workforce in Korea has been responsible for localizing Microsoft software like Microsoft Windows or Office until 2000. But it began taking on duties involving technology cooperation and support with other Korean firms as the Redmond headquarters took care of the language part with its language packs.

As a result, the Seoul-based team was given timely R&D tasks from the Redmond office from that time.

"The move seems to indicate that the R&D organisation within Korea has lost its appeal as Microsoft Korea is currently going through restructuring of costs as well as business reorganisation," said an industry source. "The decision also shows that Microsoft's US headquarters came to a conclusion that it will be better to set up the R&D control tower in China for the Asia region rather than in Korea, which is a comparatively smaller market."

sharon@heraldcorp.com

*Update*

A spokesperson for Microsoft in Singapore has written to AsiaOne to clarify that Microsoft is not dissolving its R&D arm from South Korea. Instead, some roles in Microsoft's South Korea office have been redeployed to the Redmond headquarters while others have been moved to other areas within the company itself.

In a statement today, the spokesperson said:

"The phrase R&D has been misinterpreted and Microsoft's R&D is not moving from South Korea.

"Last month, after evaluations that the company regularly does, Microsoft made adjustments to its Office workforce in South Korea.

"With work completed in a particular product area, some roles have been redeployed to Office in their Redmond headquarters, consolidating with the Office team there. Some roles moved to other areas within Microsoft.

"Some employees chose to accept severance packages and leave the company. None of this, however, involved positions in R&D or Microsoft Research or China."