After signing a deal with China's answer to Google in September, Microsoft is again strengthening its position in the country, this time by providing Windows 10 directly to the Chinese government. The company today announced a new joint venture that will license, deploy, manage, and optimize a custom version of the operating system for government agencies. The Beijing-based joint venture — provisionally called C&M Technologies — is still subject to regulatory approval, but Microsoft says in addition to government agencies, it will serve "state-owned enterprises in key infrastructure fields such as energy, telecommunications, and transportation."
Microsoft has made deals with huge Chinese companies
Microsoft is working with the China Electronics Technology Group (CTEC) for the joint venture, the two entities having previously announced a partnership back in September with the aim of helping Microsoft solidify its foothold in China. The American company has made steady progress in the lucrative Chinese market over the past few years, inking deals with huge Chinese companies such as Tencent, Lenovo, and Xiaomi, but it still has a huge problem with people using pirated versions of Windows. The company's image has also been hurt by security fears of Chinese consumers who see foreign software as a way to spy on their activities in the wake of the NSA spying scandal.
The new joint venture, if approved, would mark a turnaround in the Chinese government's view of Microsoft. In 2014, the Chinese government launched an anti-monopoly probe against the company, months after it banned the use of Windows 8 by official agencies. China's government has spent hundreds of millions on copies of Microsoft's operating system in previous years, but officials have pushed for lower prices and better tech support, especially after Microsoft abandoned Windows XP, still widely used in the country. The government even made an attempt to move away from Windows reliance by producing its own Windows XP clone, called NeoKylin.
C&M Technologies, as the exclusive licensor of the custom version of Windows 10 for the Chinese government, will provide the support the government previously requested with patches and updates, and will also take feedback on exactly what future versions of the operating system will need. In return, Microsoft gets a way to regulate at least some of the use of Windows 10 in China, and a chance to start making more money off its product.