Microsoft has expanded its theoretical research eightfold since 1997 and now has 800 people who doctorates on its payroll, The New York Times reported.

The new lab, which will open in July, continues the company's dedication to research that is not closely connected to the company's bottom line.

"Microsoft is probably the sole remaining corporate research lab that still values basic research," Maria Klawe, president of Harvey Mudd College, told the Times.

"Essentially, every other industrial lab I know is shrinking, with the exception of Google," said Jennifer Tour Chayes, 51, who has been chosen to direct the new lab.

Microsoft enticed Chayes away from her previous job as a tenured professor of mathematics at the University of California-Los Angeles in 1997, the report said.

Her contribution to product included developing algorithms that proved helped create super fast networking on the Internet, the Times said.