Microsoft suffer Chinese Windows ban order
With the success story of the Chinese economy retuning quite dramatically to growth, the world’s eyes remain fixed upon China. With the country being such an economic powerhouse and remaining a “holy grail” for Western businesses, it’s easy to forget that China is not a democratic nation and that differences in culture and law are not only significant, can often appear draconian or unaccountable.
The companies who have fallen on entering or in doing business in China are many. Plenty of corporate giants litter the path to successful domestic Chinese business activity.
The latest of these is Microsoft. The US giant has recently announced the launch of Windows 7. However, a Chinese court has now ruled that Microsoft must stop selling versions of their Windows operating system which include fonts designed in China by a Chinese company.
The court has ruled that licensing with Zhongyi Electronic has been violated by Microsoft. The Chinese court has order the US company to stop selling many Windows versions including 98, 200, 2003 and XP.
Microsoft has indicated they wish to appeal.
Clearly, due business lost to piracy in China - a country where most software, CDs or music can be found in stores or on stalls in pirated versions for just a few RMB - Microsoft will not view China as a huge revenue source in the current climate. However, as pressure is put on the Chinese to inflate their currency, as their growth and wage inflation increases, China is seen by many companies as a hugely important market in which to become established.
As highlighted by recent cases, the Chinese government is getting touch on cases of software piracy within its own borders and has even sentenced software pirates to jail sentences in recent cases. This should be seen as welcome news.
With the pitfalls great, with democratic institutions non existent and horror stories of failed ventures being extremely numerous, getting the right advice or the right Chinese partners is essential. Due diligence and being prepared for all eventualities is of paramount importance, as business in China is a different ball game to any other.
| 
