Microsoft Modifies Windows 10 for China's Government -- Update
March 21 2017 - 12:03PM
Dow Jones News
BEIJING -- Microsoft Corp. has finished development of a Windows
10 version customized for Chinese government use, which could boost
its China prospects after sales were hit by Beijing's cybersecurity
crackdown.
Microsoft declined to say how the software was modified, but in
general China's government is concerned about technology products
that could contain hidden "backdoors" to enable foreign
surveillance.
The Chinese government version of Windows 10 was developed with
state-owned company China Electronics Technology Group. Aimed at
reopening Microsoft's access to the Chinese state sector, it is
another example of how global companies are customizing products to
meet heightened security demands from Beijing.
Qualcomm Inc., Intel Corp. and other U.S. technology companies
have also struck similar Chinese partnerships. International
Business Machines Inc. on Sunday announced a joint venture with
Chinese conglomerate Wanda Group to provide cloud-computing
services.
U.S. companies must walk a delicate line in these ventures,
revealing enough about their technology to reassure Chinese
authorities without giving away core intellectual property to
partners who could become competitors -- or allow technical changes
that would allow the Chinese government to conduct surreptitious
surveillance of its own.
Microsoft declined to comment on how it addressed this balancing
act.
The software still needs to go through Chinese government review
before it can be included on official procurement lists, a
Microsoft spokesman said. Xiong Qunli, chairman of CETC, said his
company expects the government to greenlight the software.
"We're currently beginning the sales process," Mr. Xiong
said.
CETC, which develops technology for Chinese military and
civilian use, owns 51% of the joint venture with Microsoft, C&M
Information Technology Co. Ltd.
The software has already been tested at three pilot sites,
including a China customs office, according to two people familiar
with the matter.
China had dropped Microsoft's newer products from government
procurement lists following disclosures by former U.S. National
Security Agency contractor Edward Snowden about U.S. surveillance
in 2013.
Microsoft remains under an antitrust investigation by China's
State Administration for Industry and Commerce. Microsoft has long
found the China market challenging due to widespread software
piracy and China's efforts to promote domestic technology, people
familiar with the matter said.
--Eva Dou and Yang Jie
(END) Dow Jones Newswires
March 21, 2017 11:48 ET (15:48 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
Microsoft (NASDAQ:MSFT)
Historical Stock Chart
From Sep 2024 to Oct 2024
Microsoft (NASDAQ:MSFT)
Historical Stock Chart
From Oct 2023 to Oct 2024