Microsoft’s work with Chinese military university raises eyebrows

A Microsoft official said the research is “fully complies with US and local laws.” (File/AFP)
Updated 12 April 2019
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Microsoft’s work with Chinese military university raises eyebrows

  • The research covers a number of AI topics, such as face analysis and machine reading
  • Microsoft’s work with the Chinese military-backed university comes amid increasing scrutiny around China-US academic partnerships

BEIJING: Microsoft has been collaborating with researchers linked to a Chinese military-backed university on artificial intelligence, elevating concerns that US firms are contributing to China’s high-tech surveillance and censorship apparatus.
Over the past year, researchers at Microsoft Research Asia in Beijing have co-authored at least three papers with scholars affiliated with China’s National University of Defense Technology (NUDT), which is overseen by the Central Military Commission.
The research covers a number of AI topics, such as face analysis and machine reading, which enables computers to parse and understand online text.
While it is not unusual for US and Chinese scholars to conduct joint research, Microsoft’s work with the military-backed NUDT comes amid increasing scrutiny around China-US academic partnerships, as well as China’s high-tech surveillance drive in the northwest region of Xinjiang.
“The new methods and technologies described in their joint papers could very well be contributing to China’s crackdown on minorities in Xinjiang, for which they are using facial recognition technology,” said Helena Legarda, a research associate at the Mercator Institute for China Studies, who focuses on China’s foreign and security policies.
“Many of these advanced technologies are dual-use, so they could also contribute to the PLA’s (People’s Liberation Army’s) modernization and informatization drive, helping the Chinese military move closer to the 2049 goal of being a world-class military,” she added.
In an email, a Microsoft spokesman told AFP that the company’s researchers “conduct fundamental research with leading scholars and experts from around the world to advance our understanding of technology.”
In each case, the research “fully complies with US and local laws” and is published to “ensure transparency so everyone can benefit from our work,” he said Thursday.

The growing concerns around human rights violations in Xinjiang have also added pressure to US firms with business in the region, where some one million Uighurs and other mostly Muslim Turkic language-speaking minorities are held in re-education camps, according to a UN panel of experts.
In February, US biotechnology manufacturer Thermo Fisher announced it would stop selling equipment used to create a DNA database of the Uighur minority to China.
That same month, a security researcher exposed a massive database compiled by Chinese tech firm SenseNets, which stored the personal information and tracked the locations of 2.6 million people in Xinjiang.
At the time of the data leak, Microsoft was listed as one of SenseNets’ partners. The company declined to comment.
But experts have also stressed that, in the case of NUDT, Microsoft’s co-published work is open and publicly accessible.
“The authors are basically sharing with the rest of the world how to replicate their approaches, models, and results,” said Andy Chun, an adjunct computer science professor at City University of Hong Kong.
That allows others to potentially “build upon, enhance and expand this research,” he said.
Microsoft Research Asia also tends to focus on long-term research or projects that are not immediately transferable to applications, such as those that could be used to monitor or suppress a population of people, pointed out Yu Zhou, a professor at Vassar College, who studies globalization and China’s high-tech industry.
And while such concerns are certainly valid, it may be difficult for AI researchers to avoid China, she told AFP.
“It’s a field where Chinese researchers have made quite a lot of advancements, and they are generating data which is the raw material for this industry — so how are you going to avoid that?“


Microsoft tops $1 trillion as it predicts more cloud growth

Updated 12 min 22 sec ago
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Microsoft tops $1 trillion as it predicts more cloud growth

BENGALURU/SAN FRANCISCO: Microsoft Corp. on Wednesday briefly topped $1 trillion in value for the first time after executives predicted continued growth for its cloud computing business.
The Redmond, Washington-based company beat Wall Street estimates for quarterly profit and revenue, powered by an unexpected boost in Windows revenue and brisk growth in its cloud business which has reached tens of billions of dollars in sales.
Microsoft shares rose 4.4% to $130.54 in late trading after the forecast issued on a conference call with investors, pushing the company ahead of Apple Inc’s $980 billion market capitalization. The companies and Amazon.com Inc. have taken turns in recent months to rank as the world’s most valuable US-listed company.
Microsoft’s stock has gained about 23% gain so far this year, after hitting a record high of $125.85 during regular trading hours.
Under Chief Executive Satya Nadella, the company has spent the past five years shifting from reliance on its once-dominant Windows operating system to selling cloud-based services.
Azure, Microsoft’s flagship cloud product, competes with market leader Amazon Web Services (AWS) to provide computing power to businesses.
Growth in that unit slowed to 73% in the third quarter ended March 31 from 76% in the second quarter. Mike Spencer, Microsoft’s head of investor relations, said the decline was roughly in line with the company’s estimate.
Christopher Eberle, a senior equity analyst with Nomura, said that with Azure, “one should assume a slower rate of growth as we move forward, simply due to the law of large numbers.” Still, Azure will bring in $13.5 billion in sales in fiscal 2019 with an overall growth rate of 75%, he estimated. “I can’t name another company of that scale growing at these rates.”
Microsoft tops tech rivals such as Amazon in market capitalization on some days despite having less revenue, partly because most of its sales is to businesses, which tend to be steadier customers than consumers. A growing proportion of Microsoft’s software sales are billed as recurring subscription purchases, which are more reliable than one-time purchases.
Microsoft’s earnings per share of $1.14 beat expectations of $1 according to IBES data from Refinitiv.
Windows licensing revenue from computer makers grew 9% year over year, beating expectations after a 5% decline in the previous quarter. Spencer said a shortage of Intel Corp. processor chips for PCs that many analysts expected to last into this summer had been resolved earlier than expected, allowing PC makers to ship more machines.
Microsoft’s “commercial cloud” revenue — which includes business use of Azure, Office 365 and LinkedIn — was $9.6 billion this quarter, up 41% from the previous year but down slightly from the 48% growth rate the previous quarter.
Microsoft’s so-called “intelligent cloud” unit, which contains its Azure services, posted revenue of $9.65 billion, above Wall Street estimates of $9.28 billion, according to IBES data from Refinitiv. Chief Financial Officer Amy Hood said that unit could reach $11.05 billion in revenue in the fiscal fourth quarter.
The “productivity and business process” unit that includes both Office as well as social network LinkedIn had $10.2 billion revenue versus expectations of $10.05 billion.
Microsoft’s latest results contained two weak spots.
Its gaming revenue was up only 5% versus 8% the quarter before, which Spencer attributed to less revenue from third-party game developers and the fact that many gamers are delaying purchases of Microsoft’s Xbox console because a new model is expected soon.
Sales of the company’s Surface hardware grew 21% versus 39% the quarter before, also because customers waited for updated hardware they expected to be released soon.
Total revenue rose 14% to $30.57 billion, beating analysts’ average estimate of $29.84 billion according to IBES data from Refinitiv.
Net income rose to $8.81 billion, or $1.15 per share, from $7.42 billion, or 96 cents per share, a year earlier.