Winding Down Under: Microsoft Shuts Down Quantum Research in Australia, Relocates to US

Insider Brief

• Microsoft has announced the closure of its quantum computing research facility in Australia.
• As part of the move, the company will shutter Microsoft Quantum Sydney, a lab established in collaboration with the University of Sydney.
• The company reported it will consolidate its quantum research and commercialization efforts at its headquarters in the United States.

Following a fruitful research partnership in Australia, Microsoft is winding down its quantum collaboration with the University of Sydney.

Microsoft announced the company is closing its quantum computing research facility in Australia, ending its seven-year quantum partnership with the University of Sydney, according to a story in Information Age. This decision also suggests a strategic shift as the company consolidates its quantum research and commercialization efforts at its United States headquarters in Redmond, Wash.

This week, Microsoft confirmed that it would shutter Microsoft Quantum Sydney, a lab established in collaboration with the university in 2017. The lab was part of the $150 million Nanosciences Hub, which aimed to propel quantum computing into commercial viability, according to the university.

Microsoft’s spokesperson told Information Age, “Organizational and workforce adjustments are a necessary and regular part of managing our business. We will continue to prioritize and invest in strategic growth areas for our future and in support of our customers and partners.”

The closure would likely be a blow to the Australian quantum research community.

Many researchers at the Sydney facility, including its head, Professor David Reilly, will remain in Australia to continue their groundbreaking work independently.

“We are delighted that [he] and team members from Microsoft Quantum Sydney laboratories have decided to remain in Australia and will collaborate with the vibrant and growing quantum ecosystem at the University of Sydney and across Australia,” the university spokesperson told the magazine. “Professor Reilly is one of the world’s leading quantum technologists.”

The university also praised the company, saying its partnership with Microsoft had a positive impact on the quantum industry in Australia.

“The university thanks Microsoft for its contribution progressing the quantum industry in Australia,” a university spokesperson told Information Age. “Microsoft Quantum Sydney has assisted students studying quantum science at Sydney [University] develop their knowledge and technical skills, contributing to the renaissance in quantum tech underway in Australia.

The university spokesperson also acknowledged the continuing partnerships and ongoing projects, including a recent memorandum of understanding on artificial intelligence.

Groundbreaking Research and Future Prospects

Microsoft Quantum Sydney played a key role in advancing quantum computing in the country and made progress in the technology. In 2021, the team developed a chip capable of controlling large numbers of qubits, the fundamental units of quantum information. This innovation addresses the critical scalability issue that hampers the practical application of quantum computers.

Professor Reilly, who held a joint position at Microsoft and the University of Sydney, played a crucial role in this development.

Strategic Shift to the U.S.

Microsoft’s decision to centralize its quantum research in the U.S. reflects a broader strategy to streamline and enhance its focus on key growth areas. The company aims to leverage the concentrated resources and talent at its headquarters to accelerate the commercialization of quantum computing technologies.

This move is part of Microsoft’s broader plan to invest in strategic growth areas, ensuring its technological advancements align with customer and partner needs. By relocating its quantum efforts to the U.S., Microsoft seeks to consolidate its leadership in the emerging quantum computing industry.

Australia’s Efforts to Continue

Although it may be a blow to the quantum community in Australia, the country has considerable momentum in the global effort to develop quantum computers for practical problems.

The Australian federal government has been actively promoting the growth of the local quantum sector. For example, it released of the country’s first quantum strategy — designed to establish Australia as a global leader in the quantum industry — over a year ago.

Although it shouldn’t be looked at an attempt to conflate the two actions, while Microsoft is moving quantum operations out of Australia, another American quantum company, PsiQuantum, is expanding its presence in Australia. A substantial public investment from the federal and Queensland governments is supporting this expansion. Earlier this year, the government committeed nearly $1 billion (AUS) to support PsiQuantum’s initiative to develop a fault-tolerant quantum computer in Brisbane.