Sales of Windows Through China’s, Ahem, “Local Distribution Network” Will, of Course, Continue…
Well, this is ironic: Microsoft has been found guilty of violating intellectual property rights in a nation where 82 percent of all software is pirated, a nation that is home to a counterfeiting syndicate that in 2007 was busted for manufacturing and distributing more than $2 billion worth of counterfeit Microsoft software.
A Chinese court has ordered the software giant to stop producing and selling versions of its Windows OS that include Chinese fonts developed by a local software company. Microsoft’s (MSFT) use of two Chinese fonts developed by Zhongyi Electronic, a Beijing-based software company, was not covered by the licensing agreement between the two, the court found, and therefore infringed on Zhongyi’s rights. And so Microsoft must pull from the shelves Chinese language editions of Windows 98, Windows 2000, Windows XP and Windows Server 2003.
“By winning this case against an internationally well-known company like Microsoft, it shows that China, although still a developing country, is taking positive steps to protect intellectual property rights,” an attorney for Zhongyi Electronic told Reuters.
Microsoft, for its part, insists its agreement with Zhongyi covered its use of the fonts at issue and plans to appeal the decision. “Microsoft respects intellectual property rights,” the company said in a statement. “We use third party IPs only when we have a legitimate right to do so.”
And if Microsoft should fail in its appeal? Well, piracy is so rampant in China, a court order preventing the company from selling certain versions of Windows isn’t exactly going to hamstring Microsoft’s business. “The majority of operating systems in the market today are illegal copies, and the ones that are Zhongyi-related have an even smaller share of the market,” Analysys International analyst Edward Yu explains. “So I don’t think it will have much impact on Microsoft’s business.”