Microsoft Opens the Gates

Microsoft opens the gates: patents, piracy, and political challenges in China 1) Microsoft has faced significant challenges, such as the widespread piracy of its products, Chinese government to transfer its technology, host government promotion of co mpetitor products, discriminatory procurement practices by subnational authorities in China, and strong encouragement to enter into joint ventures with local firms. The risk of piracy has been diminishing as China joined the World Wo rld Trade Organisation and committed itself to honour the IPR. Software piracy rate was 92 percent in 2004 and fell to 86 percent the next year and 82 percent in 2002. The piracy rate is not only unique in China; actually it is in every country even it still occurs occ urs in developed countries. 2) Microsoft had some approaches to manage its political risks in China such as Bill Gate visited China to launch Chinese Windows. Even though following a frosty by Chinese elites, Gate did an about face and pursued a more cooperative relationship with Beijing. Microsoft cheered efforts by the Office of the U.S Trade Representative to obtain new IPR enforcement commitments from the Chinese government. Microsoft lobbied vigorously in 2000 for

China’s WTO accession. Microsoft signed agreements with four leading Chinese computer markets: Legend, TCL, Tsinghua Tongfang, and Great Wall, to preinstall Windows XP on their machine. As well, it signed an accord with the Shanghai Shanghai regional support centre into a global support centre, and trains thousands of so ftware architects. Also, it became the first foreign firm to become a member of the t he Chinese Software Industry Association. Microsoft signed a

three year $750 million deal with China’s State Development Development & Planning Commission. Few years later, Microsoft agreed to let let the Chinese Government Government see the source code for the Windows operating system and all Office 2003 products. In 2005, Microsoft MSN announced a partnership with Shanghai Alliance Al liance Investment Ltd. To launch the MSN China online portal for delivering MSN products and services to customers in China. China. Microsoft worked in 2005 and into 2006 to conclude new agreements with Chinese PC manufactures, manufactures, develop new partnerships and better its relations with the Chinese government. With respect to partnerships, Microsoft began to lic ense technology to Chinese firms. By doing all these favourable deals with Chinese firms an d the Chinese government’s 2006 to require all

PC manufacturers to have legitimate operating system to Microsoft’s concerted overtures toward China. Microsoft favoured a being partners partners technique with Chinese Chinese firms because they want to be a part of Chinese PC industry, they want to get all the big firms use their products slowly and then they can c an enhance their power. This technique also a best one. Microsoft has to deal with software privacy because it will be a continuing challenge to

Microsoft’s growth in China. 3) Microsoft frequently had to deal with lower levels of government gave them good opportunities as they can get closed to the higher levels of government through the lower ones. Then it is going be easy for them to build a good relation between the company and the government. The special challenge is it is difficult to get the government to believe in the products. 4)

Other firm such as Linux does not have the same situation as Microsoft because they have the support from the Chinese government

5)

Microsoft is creating a serious risks by supporting, financing, and transferring technology to local Chinese software firms as if once they understand the software they might be able to let out the secret technique of Microsoft. Mi crosoft. Then it will be even easier for other companies to copy it and it is hard to control piracy because the IPR is weak in China.