Microsoft hopes to triple the number of students and teachers trained in its software programs to up to 270 million by 2013, and will spend $235.5m in schools worldwide over the next five years to help drive the effort.
The money, part of the Partners in Learning programme, will go toward training and skills programmes in areas with limited IT training and equipment, said Orlando Ayala, vice president of the Unlimited Potential Group, part of Microsoft's education division.
The announcement is one of several expected to come from the Government Leaders Forum (GLF), an annual conference where Microsoft courts educators and government officials. Microsoft CEO Bill Gates will give the keynote at the GLF on Wednesday in Berlin.
Microsoft's investment shows how important it views developing markets to its future business. Last year, Microsoft introduced the Student Innovation Suite, which includes the XP Starter Edition plus educational applications, for $3 for qualifying countries.
Microsoft faces heated competition from companies supporting the open-source OS Linux and associated software in developing countries. "I think as a company we welcome choice," Ayala said. "Frankly, we welcome the competition."
The company's educational funding comes with a hitch: "Of course, that includes the fact they [the schools] use Windows," Ayala said.
That approach contradicts one recommendation contained in a study of software usage in Europe completed in November 2006.
Presented to the European Commission, the study concluded that it's better for students to learn general IT skills rather than just proprietary software.
Otherwise, it's less likely that software from other vendors will be used if people are only trained in programs from one vendor, said Rishab Aiyer Ghosh, of the United Nations University-Merit in Maastricht in the Netherlands. Ghosh is one of the authors of the study.
Microsoft's educational donations look less generous when the company spends "it in order to create a market that's forced into buying its products," he said. But Ghosh added it's hard to argue that struggling schools "should refuse the computers altogether if there's no money".
Microsoft has recently made significant deals in developing areas. A non-governmental organisation in Russia is buying 1 million units of the Student Innovation Suite over the next five years, Ayala said. The company is also supplying 50,000 units of the same software to Mexico and 150,000 to Libya, he said.
While Microsoft is nudging consumers and businesses in developed markets to use its latest Windows Vista operating system, XP will remain the OS the company supports for low-cost laptops such as the Asus Eee PC and Intel's Classmate PC, Ayala said.
The reason is XP has a smaller footprint than Vista, Ayala said, referring to factors such as how much memory the OS uses and the size of the OS on a PC's hard drive.
Microsoft is still working through some of the "technical limitations" that remain in putting XP on the XO, the green PC from the One Laptop Per Child project, Ayala said.