Microsoft will handle all its Internet business transactions across Europe, the Middle East and Africa from Dublin in a move which should safeguard Irish jobs and establish the Republic as a major international e-commerce hub.
The company confirmed yesterday that it had contracted AboveNet, a subsidiary of Metromedia Fibre Network, to establish and maintain a $75 million (#87.64 million) Internet data centre in the CityWest Business Park. This data centre will provide Microsoft with the capacity required to handle the huge volumes of transactions predicted to arise from a new strategy, Microsoft.net.
This involves the delivery of software via the Internet rather than through traditional means. The company claims this will be more efficient and save customers time and money.
Microsoft will conduct a pilot project in the Republic from November and predicts the full strategy will go live in the European, Middle Eastern and African region sometime next year.
Mr Bob Herbold, executive vice-president and chief operating officer of Microsoft, said he believed more than half of Microsoft's software sales would be made over the Internet within five years.
The decision to choose Dublin as its Microsoft.net base for the region comes only two years after Microsoft shunned the Republic for a major Internet project called Mirror. The company cited the Republic's poor telecoms infrastructure and lack of Internet connectivity as the reasons for siting that project in the UK.
But, speaking at a function to celebrate Microsoft's 15th year in the Republic yesterday, Mr Kevin Dillon, managing director of Microsoft European Operations Centre, said the rate of progress since then had been "nothing short of extraordinary".
He said the decision to locate the Internet development centre in the Republic marked a significant first step along the digital road and towards Ireland.Net as Europe's e-business centre.
The Taoiseach, Mr Ahern, said the announcement was a strong endorsement of the Government's plans to make Ireland a world class e-business centre. "We now have the bandwidth in place, costs have come down dramatically and are still falling." The announcement by Microsoft follows a number of significant announcements regarding e-business investments from companies such as IBM, Oracle and Novell. IDA Ireland said last night it expected the Microsoft investment would encourage other companies to invest in the Republic.
Microsoft employs more than 1,600 people at its European operations centre, European product development centre and a sales and marketing operation in the Republic.
