August 3, 2006


Via Facsimile (206) 623-7022 and US Mail

Richard B. Dodd
William Gleeson
Preston Gates & Ellis LLP
925 Fourth Avenue, Suite 2900
Seattle, WA 98104

Re:	Microsoft Corp.
	Schedule TO-C filed July 20, 2006
	Schedule TO-I filed July 21, 2006
	Schedule TO-I/A filed July 27, 2006

Dear Messrs. Dodd and Gleeson:

We have reviewed the filings listed above and have the following
comments. All defined terms have the same meaning as in the tender
offer materials, unless otherwise indicated. "You" and its
derivatives as used here refer to Microsoft Corporation.

Schedule TO - Item 10. Financial Statements
1. Please explain in your response letter why you do not believe
that
the financial information showing the pro forma effect of the
Tender
Offer on Microsoft is not material. See Item 1010(b) of Regulation
M-
A. In this regard, we note that if fully subscribed, you could be
repurchasing more than 8% of Microsoft`s outstanding shares in
this
Offer.

Offer to Purchase - General
2. Include a brief statement as to the accounting treatment of the
transaction. See Item 1004(a)(xi) of Regulation M-A.

The Tender Offer, page 2
3. The disclosure in the first bullet point in this section (at
the
bottom of page 2) states that the offer may need to be extended if
you "increase the price to be paid for tendered shares above
$24.75
per share or decrease the price to be paid for shares below $22.50
per share" and less than ten business days remain in the Tender
Offer
when this change occurs. However, we believe you may be required
to
extend the Tender Offer if you make any change to the range
presented
for this modified Dutch auction tender offer. See Rule 14e-1(b).
If
you concur, please revise your disclosure accordingly. If you
disagree, please provide appropriate supporting legal analysis in
your response letter.

Conditions of the Tender Offer, page 14
4. Refer to the disclosure in the first paragraph of this section.
In
a parenthetical, you state that the listed events representing
conditions to this offer must have occurred "at any time prior to
the
Expiration Time (whether any shares have theretofore been accepted
for payment)." How could shares be accepted for payment before the
Tender Offer ends? Please revise or advise.
5. The language in the same introductory paragraph seems to
indicate
that if an event occurs that "triggers" one the of listed offer
conditions, Microsoft then reserves the right to make a secondary
determination that it will "assert" the condition to terminate the
Tender Offer. We agree that this is within the discretion of the
bidder in a Tender Offer; however, if for example, the Dow Jones
Industrial Average falls by 10% or more and the Company proceeds
with
the Tender Offer, it is in effect waiving that condition. Waiver
of a
material offer condition may require an extension of the Tender
Offer
and dissemination of additional offer materials. Please confirm
your
understanding in your response letter.
6. You may condition your tender offer on any number of conditions
as
long as they are clearly and concisely described in the Offer to
Purchase and outside of your control. Please make the following
changes to this section:

(i)	clarify as of what date you will judge the decrease of 10% in
the market price for shares on the listed exchanges. That is, if
the
Dow Jones Industrial Average falls by more than 10% on day ten of
your Tender Offer, but recovers and is up by 2% on the scheduled
Expiration Date, would this condition be triggered? It would
appear
from the language in the introductory paragraph that it would be
but
this is less than clear; and

(ii)	clarify how the condition listed in the third bullet point on
page 15 relates to ongoing wars and hostilities involving the
United
States that predated the Tender Offer (e.g., Iraq, Afghanistan,
etc.). Since there is no "material escalation" language in the
conditions section, this condition would appear to be triggered
now.
7. As noted in our last comment above, it is important that all
offer
conditions be clearly described such that Microsoft shareholders
can
determine whether an event has occurred that will allow the
Company
to terminate the Tender Offer. Because many of the listed offer
conditions are broadly drafted, please include in your response
letter an undertaking to inform shareholders promptly if you
believe
an event has occurred that allows Microsoft to terminate the
Tender
Offer. In our view, you may not wait until the end of the offer
period to terminate the Tender Offer based on an event that
occurred
on day ten of the Offer.

Fees and Expenses, page 25
8. If you will compensate the Dealer Managers in whole or in part
based on the number of tendered shares they solicit, please
disclose.
In addition, we note the disclosure here that the Dealer Managers
may
hold Microsoft shares for their own accounts. Please indicate
whether
you intend to pay fees to the Dealer Managers based on tenders of
subject securities held for their own accounts. If so, explain in
your response letter why you believe this practice is consistent
with
Rule 13-4(f)(8). If you do not, indicate how you will ensure that
you
do not pay fees under such circumstances. For example, if you
intend
to compensate the Dealer Managers in part based on the number of
tendered shares solicited, what mechanism will you use to
determine
who held the tendered securities when calculating the fees owed to
Goldman, Sachs & Co. and Deutsche Bank Securities Inc.?

Exhibit (a)(1)(G) - Summary Advertisement
9. Indicate where the summary advertisement included as an exhibit
to
the Schedule TO-I was published.
Closing Comments

Please respond to the above comments promptly. If you do not agree
with a comment, tell us why in your response letter. Where you do
make changes to the Offer to Purchase as a result of our comments
above, include a page citation in your response letter indicating
where the requested changes appear in the revised offer materials.
Be
aware that we may have additional comments based on your comment
responses.

We urge all filing persons who are responsible for the accuracy
and
adequacy of the disclosure in the filing to be certain that the
filing includes all information required under the Securities
Exchange Act of 1934 and that they have provided all information
investors require for an informed investment decision.  Since the
filing persons are in possession of all facts relating to their
disclosure, they are responsible for the accuracy and adequacy of
the
disclosures they have made.


In responding to our comments, please provide, in writing, a
statement from Microsoft Corporation acknowledging that:

* It is responsible for the adequacy and accuracy of the
disclosure
in the filing;

* Staff comments or changes to disclosure in response to staff
comments do not foreclose the Commission from taking any action
with
respect to the filing; and

* It may not assert staff comments as a defense in any proceeding
initiated by the Commission or any person under the federal
securities laws of the United States.

In addition, please be advised that the Division of Enforcement
has
access to all information you provide to the staff of the Division
of
Corporation Finance in our review of your filing or in response to
our comments on your filing.

If you have any questions please do not hesitate to contact me at
(202) 551-3263.


Very truly yours,



Christina Chalk
Special Counsel
Office of Mergers and Acquisitions







Richard B. Dodd, Esq.
William Gleeson, Esq.
August 3, 2006
Page 1





UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-0303

         DIVISION OF
CORPORATION FINANCE