The campaign against software piracy in China has received a boost from a newly formed alliance of leading Chinese PC manufacturers and US software giant Microsoft.

Last week, the Great Wall Corp, Legend Group, TCL Computer Technology Co and Tsinghua Tongfang Group said they would pre-install Microsoft's Windows XP operating system on their home PCs.

The four Chinese PC manufacturers represent 60 per cent of the country's PC market.

Microsoft predicted that there would be follow-up deals.

Chen Chong, a senior official at the Ministry of the Information Industry, said the move would further promote the growth of a fair environment for all rivals in the market and signal that domestic players are taking steps to fight illegal competition.

The move is the first tie-up amid the fierce competition of China's PC market, which has been hurt by price wars.

Microsoft hopes its Windows XP operating system will become a standard in Chinese households.

Windows XP is the latest version of Microsoft's dominant operating system, following its Windows Millennium, Windows 98 and Windows 95 series.

At last week's signing ceremony, Kelvin Hou, deputy general manager of Microsoft China, said: "China has become one of the most significant markets in the world's PC market, and the move will lead to a better performance for Microsoft in the market."

China's PC market is growing rapidly and is the world's third largest. But software firms suffer billion-dollar losses annually due to the unlicensed use of their products in China.

Dong Jingsheng, deputy secretary-general of the China Consumers Association, said of the new alliance: "It will be a triple-win situation for the computer manufacturers, Microsoft and consumers."

On the other side of the coin, Microsoft will be the largest beneficiary, as the alliance will stimulate the rapid expansion of its operating systems in China's market, one of the most important markets for the company.

China has taken steps to root out piracy in recent years.

But other experts said they are worried that further alliances could lead to a market monopoly that would threaten the smooth growth of the sector in China, where there is still no anti-monopoly law or expertise to fight such practices.

Still missing from the alliance are big Chinese PC manufacturers such as Beida Founder, Hisense and Haier.

(China Daily 12/11/2001)