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Microsoft Plans European Search Technology Center

The center, with facilities in London, Paris, and Munich, is the latest sign that the software vendor is making Internet search a top priority.
Microsoft said Thursday that it plans to open in Europe a research center dedicated to developing new Internet search technologies.

Microsoft said its European Search Technology Center will operate three "centers of excellence," in London, Paris, and Munich.

"The aim is to tap into local expertise and fuel local innovation with job opportunities that will help reinvent the European consumer online and search experience," the company said in a statement.

The Search Technology Center will be led by Jordi Ribas, who will vacate his current post of general manager for Microsoft's Connected TV business group.

Speaking at an event in Paris, Microsoft CEO Steve Ballmer said the plan will help the company establish a bigger footprint in the lucrative search market while diversifying its geographic base. "To compete in a global, innovation-driven economy, we need to draw on the world's smartest, most creative minds. Increasingly, we are finding that talent here in Europe," Ballmer said.

Microsoft invests about $600 million per year in research and development in Europe. "This is good news for the European Union, which decided long ago, with the Lisbon strategy, to do go down the road of the knowledge-based economy," said French finance minister Christine Lagarde, in a statement provided by Microsoft.

Microsoft needs to do whatever it can to catch Google in the Internet search market. Currently, Google holds about 60% of the market, compared with Microsoft's 9% share.

Increasingly, Microsoft is turning to acquisitions in an effort to catch up. Through the first nine months of 2008 the company committed more than $1.5 billion to acquiring search, or search-driven businesses -- including a $1.3 billion buyout of enterprise specialist Fast Search & Transfer in April.