Microsoft and China's leading IT distributor Digital China have formed a global partnership. 

The partnership means Digital China could use the platform provided by Microsoft's powerful research and development team to develop new software products. It also means in the not far future, Chinese customers may use high-quality products which cost less.

Tim Chen, Microsoft vice-president and chief executive of its mainland, Taiwan and Hong Kong operations, says Microsoft could also benefit from such a partnership.

"We can enable more small and medium sized companies to develop new application software on our platform. And with Digital China's sales network and its partnership with many big Chinese companies, the application software could be put into use immediately. China's application software is in its initial period. I think its rapid development will surely strengthen the position of our platform. So it's a win-win situation for both of us."

Analysts say Microsoft is facing enormous challenges in China. The Chinese government and companies are finding Linux more appealing as a low-cost alternative to Windows. And Microsoft has to compete directly against China's homegrown software players.

With this in mind, Microsoft has moved to consolidate its presence, and over the past four years has opened three joint ventures, unprecedented for the company anywhere in the world.

Not long ago it penned a deal with Changhong, the country's leading home appliance manufacturer to cooperate in the multimedia area.

(CRI July 6, 2004)