Microsoft Research Silicon Valley was founded in August 2001 and quietly closed in September 2014… Lab’s primary focus was on distributed computing and included privacy, security, protocols, fault-tolerance, large-scale systems, concurrency, computer architecture, Internet search and services, and related theory. Research in these areas continues in other Microsoft Research labs around the world. Read more: http://research.microsoft.com/en-us/labs/siliconvalle/

In other words, … everywhere around the globe but not in Silicon Valley. Why? There appears to be a crises of corporate cultural incompatibility, that can be traced to early 80th and then continued in 90th:

• “If the company does well, I do pretty well,” says [Mark] Andreessen. “If the company doesn’t do well” – his voice takes on a note of mock despair – “I work at Microsoft.”
• Bill Gates:”…an Internet browser is a trivial piece of software. There are at least 30 companies that have written very credible Internet browsers, so that’s nothing… ”
• Steve Jobs: “The most important thing for the Web is stay ahead of Microsoft.”

–Roads and Crossroads of the Internet History by Gregory Gromov