A penguin,a panda & an animated paperclip go into a bar
Fortune magazine has an interesting article stressing the Chinese market's importance to Microsoft's long term strategy, and touching on Linux's involvement in the Chinese market.
In the early days of Microsoft rampant piracy helped establish it as the de facto standard in PCs despite good alternatives. History may be unfolding again here, with the exception that having the Chinese government as an ally has huge additional benefits. Or perhaps Gates has met his match with the Chinese government.
In another boost for Microsoft, the government last year required local PC manufacturers to load legal software on their computers. Lenovo, the market leader, had been shipping as few as 10% of its PCs that way, and even US PC makers in China were selling many machines "naked." Another mandate requires gradual legalization of the millions of computers in state-owned enterprises. In all, Gates says, the number of new machines shipped with legal software nationwide has risen from about 20% to more than 40% in the past 18 months.
I bought a new Presario laptop in Dalian last year, the initial machine was void of an operating system. The nice clerk unwrapped the new machine and straight away brought out a nice new shiny CD of Microsofts XP OS. Needless to say I never let the young fellah put the CD into the drive. This is one user in China which China has not conquered. Should I have gotten the computer at a cheaper price without the OS installed? Anyhow I left him with the words Debian Linux ringing in his ear.
So has Microsoft truly conquered China? I don't believe so. Firstly should we define victory by having every single machine running a version of Windows? Is it based on sales in which case Linux doesnt stand a chance. Maybe defined by the number of home or business users? By the way, even pirated software sellers do not stock linux in their cardboard boxes, why sell something which be obtained completely free. Mission criticle systems in any business will continue to run on some nix based system, if they don't then their IT manager should be fired!
The article I am referring to makes notes to how the current regime in China is very close to Mr Gates, who is actually treated like a rock-star in Beijing. Hell, Hu Jintao even had dinner in Mr Gates humble abode, Microsoft must be great. I should remind people that Microsoft made no secret of their dealings with the US government regarding encryption and purpose built-in back doors to their software. Outrage from the Chinese people ensued which led to a brief boycott of the system for a time. As a result of all of this subterfuge Microsoft has allowed China to have a look at the fundamental source code for its Windows operating system and to substitute certain portions with their own software - something Microsoft had never allowed in the past. Now when China uses Windows in President Hu's office, or for that matter in its missile systems, it can install its own cryptography. China was very keen "to control our own destiny", while the People's Liberation Army Daily noted that "without information security, there is no national security in politics, economics, and military affairs."
Efforts such as this probably play a large part in Fortunes perception that Microsoft has conquered China. When asked about why the people of the Middle Kingdom liked Linux Gates appeared upset and replied:
"What the heck are you talking about? I think what you're talking about is that you're assuming that the American does a reliable job in reporting on China. I doubt you read the government's press release... what the press in [the US] wrote and what the facts are is 100 per cent different."
Of course it is well known that the Chinese governments press releases are always 100% correct and valid. Anyhow, I digress. On another note I find it hard to imagine that no-one seems to be paying attention to Red-Flag Linux. During the latest launch for Red-Flag Linux the Ministry said it would give its full support to the development of Red Flag Linux, as well as all the other Linux systems.
Red Flag Linux has gained around a quarter of the server market since it was launched at the end of last year and the Chinese government also reported that software sales in the first half of this year grew to 9.1 billion yuan ($1.1 billion), with the domestic proportion being 30 per cent. There is additional support in that Jiang Mianheng, the son of Chinese president Jiang Zemin, plays a prominent role in the management of Red Flag. It's been a while since anything worthwhile was released by this company. The last release was in 2005, with 5.0. Time for some Chinese to get patriotic and do their duty to update this Microsoft killing Chinese beheamoth.
So in conclusion, Microsoft has a "a great market share in China but not a lot of revenue". Microsoft software is just too damm expensive for the market. Personally I think 5RMB for a DVD of Microsofts complete software catalog is just simply way too much. China's operating system heart is still up for grabs, Canonical, Red-hat, Solaris and many more different nix enterprise providers have set up shop in China. I don't think this press release will cause them to lose much sleep.
For Microsoft, there is a dangerous possible downside to this: the Chinese government still may decide to avoid any anti-piracy enforcement problems by declaring Linux to be the official operating system for the government in the future. If the world's biggest potential market went Linux, it is easy to envisage a consequent domino effect that would not just strengthen Linux in the rest of Asia, but have a profound effect in the western world as well. For a company that has spent billions investing in the Chinese market perhaps they should be the ones experiencing the sleepless nights.
Disclaimer: I live, breath and dream Linux when not dreaming of beautiful girls...(I think it's impossible to breath and live beautiful girls, one can but try though).
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