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China's Linux desktop market booms

By Chen Nan Yang on December 11, 2007 (9:00:00 PM)

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Although China's Linux market as a whole doubled from 2003 to 2006 to $20 million per year, sales of Linux desktop software grew more slowly. In fact, the market share of Linux desktop software in China dropped from 16% to 12% in the same period. But according to CCID Consulting, sales of Linux desktop software increased 25.1% in the third quarter of this year, catching up with the quick growth of China's Linux industry as a whole. Several new developments have added fuel to the growth.

The Chinese government's antipiracy movement has had an effect. After the central government published two regulations last year to force its departments and local governments to stop using pirated software, the government has increased its spending on low-cost Linux desktop software. Last year, the antipiracy movement focused mainly on senior province and city governments, but this year it filtered into the junior village and town governments as well -- areas that previously relied on pirated software. Currently, the government is responsible for purchasing accounts for more than one quarter of China's Linux desktop software market, and the homegrown Red Flag Linux leads the government market.

Industry users, such as hotels, lottery sellers, and telecommunications companies, also increased spending on Linux desktop software this year. According to CCW Research, online business in China's hotel industry will have increased more than 30% this year, causing hotels to buy more computers and software to establish or improve their Internet order systems. The low-cost Linux desktop software has earned big market share here.

Emerging markets also add momentum to the Linux desktop market. For example, the estimated 6 million computers that will be sold in China's rural areas in 2007 and 2008 provide a big stage for Linux desktop software.

Hardware vendors have also begun to promote Linux desktop software in the Chinese market. In 2007, computer makers such as Dell and Lenovo preinstalled Linux desktop operating systems in their computers for Chinese buyers. Dell has begun to sell some of its computers with Novell's SUSE Linux in China.

Dark side of the growth

Despite its rapid growth, China's Linux desktop software industry faces some problems. Piracy is still an issue. Using pirated Windows can be easier and cheaper than using a Linux desktop OS. Zhen Zhongyuan, vice president of Red Flag, says that China's Linux desktop market would increase as a "geometric series" every time piracy decreases 1%.

The high uninstall rate of the Linux desktop OS also diminishes actual growth. According to CCW Research, 31.9% of Chinese users uninstall their Linux desktop OS after buying a computer with it included. Some computer retailers themselves uninstall it and install pirated Windows instead if buyers ask for it. Retailers and personal users are more inclined to uninstall it than industry users, who seldom uninstall it because their industry software runs on it.

Additionally, the low-cost advantage of Linux desktop software is diminishing. Microsoft has taken a more flexible pricing tack in the Chinese market, offering increasingly better discounts for Chinese computer producers. An anonymous executive of a Chinese computer producer says that his company considered using the Linux desktop OS at the beginning of this year, but eventually went with Windows because Microsoft didn't charge much more than the service fee of Linux companies. He suggested this could be looked at as a victory for Linux, as it had forced Microsoft to lower its price.

Despite a few problems, the future of China's Linux desktop industry remains bright. Once the country can settle its problems, the Linux desktop industry is expected to continue its fast increase in China.

Chen Nan Yang is a Chinese freelance journalist and former IT director in the Chinese government.

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China's Linux desktop market booms

Posted by: Anonymous [ip: 58.70.48.242] on December 12, 2007 05:26 AM
Well, if the Chinese want to continue to be the slaves of an American corporation, good luck to them.
Meanwhile, savvy freedom loving nations continue to pursue linux freedom.
I do hope the Chinese are using M$ junk on their government, banking, defense computers, etc. It'll make them so much more vulnerable to U.S. intelligence, etc.
Yes, China, keep using M$

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12% market share is the key number here

Posted by: Anonymous [ip: 82.192.250.149] on December 12, 2007 07:19 AM

If the Linux market share is 12%, Microsoft is going to fight back, hard. And they certainly have the resources. The marginal cost to them of shipping Windows is just a few cents per copy, and they already have enough monopoly profits in the USA and Europe - they could choose to operate in China at a loss, essentially giving away Windows, in order to preserve their monopoly.


I don't see a defense to this strategy, so I think Microsoft will win China.


Mac market share in China? Let me guess: less than 0.1%? :-)

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Re: 12% market share is the key number here

Posted by: Anonymous [ip: 82.160.130.34] on December 13, 2007 09:09 AM
The author links to CCID Consulting report. The report says:
"Linux accounted for 2.5% of the overall non-embedded operating system market, up by 0.4% over 2006."
So the 12% is probably some mistake.

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China's Linux desktop market booms

Posted by: Anonymous [ip: 152.17.103.33] on December 12, 2007 10:13 AM
And dont forget about Loongson ;) Mandriva Linux is ready for it, read linux.com article about :
http://www.linux.com/feature/119890

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China's Linux desktop market booms

Posted by: Anonymous [ip: 80.6.16.101] on December 12, 2007 11:56 AM
Then once Microsoft have saturated China using cheap offers of windows and the country becomes reliant on windows like the west is, microsoft will manipulate China and up the price or hold them to ransom if they don't comply.

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Re: China's Linux desktop market booms

Posted by: Anonymous [ip: 76.223.162.57] on December 12, 2007 02:22 PM
China is still a totalitarian, socialist state, not a free market economy. They can seize all MS assets in their country tomorrow if they want; they can decree that only linux can be used tomorrow if they want and everyone will fall in line. No one is going to successfully demand any ransom from China.

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Re(1): China's Linux desktop market booms

Posted by: Anonymous [ip: 69.227.163.88] on December 12, 2007 10:29 PM
Agreed China does business for China's sake, not for the benefit of anyone else. The Chinese government is extremely pragmatic and most Chinese people are consummate savers. If MS ever tried to up the price of Windows/Office in China most of them would look for ways to convert file formats for anything they want to keep and switch to a cheaper platform before they just go out and buy Windows. This is one of the reasons MS had to drop the price to pennies in China, low-cost pirated windows and linux forces them to keep the price down because of the nature of Chinese culture. And as long as those two are there (or even one), the price will always be kept down.

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China's Linux desktop market booms

Posted by: Anonymous [ip: 121.32.214.1] on December 13, 2007 06:04 AM
I live in China. Chinese people will never accept Vista the way they did XP. We all know about Vista's DRM, high cost, security and peformance problems. Linux will continue it's growth in Cheap notebooks (ASUS Eee pc) and eventually find strong growth in other segments. Linux needs no marketing department- it will grow organically, you can find it in all types of devices anyway. Linux 6 month release cycle and development with an eye on kernel and desktop performance is going to kill MS anyway. People in China have huge problems with having to pirate software and network viruses. Relief is in sight.

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China's Linux desktop market booms

Posted by: Anonymous [ip: 58.221.240.234] on December 13, 2007 09:30 AM
The main problem that I've seen from living in China for the past 5 years or so is that the people are too dependent on their families and the government too really branch out and take risks on their own or to learn something that no one else is learning. This is why it's taking so long for linux to be adopted in China despite Linux's ease of use, 3D eye candy, and good software support and availablity. Plus their government schools- where the children are force fed 99% of the things that they never really use on the outside. Students are usually in school from 7am to 10pm and are only concerned with passing exams to please their parents or to get into some college. Finally most Chinese have no leisure or free time to play around with new toys, not to mention new ideas, at least not since ancient times.

There are of course exceptions, but those are rare.

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Chinese websites and Firefox

Posted by: Anonymous [ip: 58.246.56.18] on December 14, 2007 02:02 AM
I think it is good that China is going to adopt Linux. But what will probably also slow down the growth is that most chinese web sites don't work well with Firefox.

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China's Linux desktop market booms

Posted by: Anonymous [ip: 219.82.185.26] on December 14, 2007 05:49 AM
Just bought a laptop in china with red flag installed for a friend.

When you start the computer, it leaves you in a simple terminal, no X server, no openoffice, no kde, no gnome, nothing for the desktop user.

The vendor don't even know how to run the red flag OS installed, it is routine for them to install XP after the laptop is sold.

Everybody buying these machines ask to the vendor for XP and the vendor will gladly install a pirated version with SP2, windows office, photoshop and everything else you need.

To make everything look worse, i have been unabled to install any of the easy linux distributions on that laptop (ubuntu, opensuse, pclinuxos, mandriva, and so on...)

"According to CCW Research, 31.9% of Chinese users uninstall their Linux desktop OS after buying a computer with it included.", i'm working for a professionnal Research company, but i'm spending a fair amount of time in the computer markets around and i can't believe such figure.

For info, the laptop is an asus turion i don't remember the number.

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Re: China's Linux desktop market booms

Posted by: Anonymous [ip: 219.82.185.26] on December 14, 2007 05:53 AM
ooops sorry, i'm NOT working for a professionnal Research company...

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Re: China's Linux desktop market booms

Posted by: Anonymous [ip: 99.235.216.118] on December 19, 2007 12:07 PM
Not sure whether Red Flag has roots in Red Hat or Debian GNU/Linux, but chances are they might use one of them as a base. If so, you can check the /sbin directory for system-config-display (Red Hat) or dpkg (Debian).

If it's Red Hat based just run (as root): system-config-display
If it's Debian GNU/Linux based run: dpkg-reconfigure xserver-xorg

Note that your packages may have a slightly different name in Red Flag (have never used it myself) in which case you'd replace xserver-xorg with the appropriate name.

Hope this helps.

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China's Linux desktop market booms

Posted by: Anonymous [ip: 210.17.202.235] on December 14, 2007 05:26 PM
I have never ever seen a desktop or notebook PC in China running Linux, and I spend a lot of time there and see a lot of machines. These market share figures are made up.

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About Linux

Posted by: Anonymous [ip: 76.209.135.141] on January 01, 2008 11:33 PM
Mac is obviously better than windows and linux, period. So why should we care what Linux does.

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