Software giant Microsoft is tackling the mainland's growing domestic demand by forming a new unit that, for the first time, will develop and launch software for the Chinese market.
The products developed for China will be based on local research and demand but, eventually, could be adapted and shipped to customers in the United States and other markets.
The move marks a significant departure for Microsoft China, which has a formidable research team but has tended to work in tandem with research operations serving markets in the West. Now, China will be both a first market for the company and a testing ground for technologies untried elsewhere.
The announcement comes in the wake of the increasing dominance of Linux in the mainland. Microsoft has identified Linux, a free operating system, as one of its biggest threats as companies and governments around the world switch to - or at least try out - the software.
Linux is immune to many of the viruses which target the Microsoft operating system. Analysts have said that Linux could limit Microsoft's influence in the mainland, while allowing local software firms to grow in their market.
However, the world's largest software maker planned to 'focus on a few products we believe will be a huge hit in the future', Microsoft Research Asia managing director Zhang Ya-Qin said. 'Products could start here and then move elsewhere.'
Part of the goal is to encourage local software companies to contribute products that fit with Microsoft software. 'With the advanced technology centre, we are going to focus on developing the software ecosystem,' Mr Zhang said.
