Microsoft Corp said it will include Chinese-designed security software in versions of its Windows programs sold in China, a move analysts said is aimed at allaying fears that the company's dominance is hurting growth of the local software industry.
The biggest software maker's Windows 2000 and Windows XP Professional packages sold in China will incorporate encryption software designed by China National Computer Software & Technology Service Corp (CS&S) and should be on sale later this year or early next year, Microsoft said in a statement. To use the software, customers will have to buy a card from CS&S.
China is encouraging local companies to use a rival operating system created by Linux Corp -- which allows users to freely develop the software -- in a bid to expand the local software industry. The move by Microsoft, whose Windows operating system runs about 95 percent of all computers in China, will do little to ease concern that the company's near-monopoly position is hampering domestic growth, some analysts said.
The agreement seeks to "quell Microsoft's ability to succeed in China," said Rajiv Gupta, a software analyst at Goldman Sachs Asia LLC in Hong Kong. "Enterprises and the government in China will continue to be reasonably skeptical despite the fact that one of their own entities is involved."
China, with an economy twice the size of India, exported only about US$400 million of software last year compared with India's US$6.2 billion, mainly because of software piracy and lax enforcement of patent laws. Illegal versions of Microsoft's Windows 2000 are widely available.
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