Microsoft asks hundreds of China-based AI staff to consider relocating

The White House is considering new rules that would require Microsoft and other U.S. cloud-computing companies to get licenses before giving Chinese customers access to AI chips.
The White House is considering new rules that would require Microsoft and other U.S. cloud-computing companies to get licenses before giving Chinese customers access to AI chips.

Summary

The request comes as the Biden administration toughens controls on China’s access to cutting-edge American technology.

BEIJING—Microsoft is asking hundreds of employees in its China-based cloud-computing and artificial-intelligence operations to consider transferring outside the country, as tensions between Washington and Beijing mount around the critical technology.

Such staff, mostly engineers with Chinese nationality, were recently offered the opportunity to transfer to countries including the U.S., Ireland, Australia and New Zealand, people familiar with the matter said. The company is asking about 700 to 800 people, who are involved in machine learning and other work related to cloud computing, one of the people said.

The move by one of America’s biggest cloud-computing and AI companies comes as the Biden administration seeks to put tighter curbs around China’s capability to develop state-of-the-art AI. The White House is considering new rules that would require Microsoft and other U.S. cloud-computing companies to get licenses before giving Chinese customers access to AI chips.

A Microsoft spokesperson said providing internal opportunities is part of its global business and acknowledged the company had shared an optional internal transfer opportunity with a subset of employees. The company remains committed to the region and will continue to operate in China, the spokesperson said.

In Washington, Microsoft’s cloud business and AI research in China have caught policymakers’ attention. Microsoft employs roughly 7,000 engineers for its Asia-Pacific research-and-development group, with most based in China.

Its China cloud and AI team participates in Microsoft’s global R&D for its core products. Those asked to consider transferring are a portion of the thousands of engineers working on Microsoft’s cloud efforts, one of the people said, adding that if they choose not to transfer out of China, they can keep working in the country.

The offer to relocate was made earlier this week, another of the people said.

Globally, Microsoft, whose businesses range from cloud computing to games, is on a spending spree to build AI infrastructure. The company has recently pledged billions of dollars in spending on data centers around the world.

Write to Raffaele Huang at raffaele.huang@wsj.com and Yoko Kubota at yoko.kubota@wsj.com

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