Beijing, March 20 (Bloomberg) -- China's government said it will invest in Red Flag Software Co., China's largest Linux software developer, to try to curb Microsoft Corp.'s dominance in the country's market for computer programs.
CCIDNET Investment Co., a venture capital investor owned by the Ministry of Information Industry, will become Red Flag's second-largest shareholder after the China Academy of Science and will help the company list on a stock market in China or abroad.
``The Linux industry has a great outlook,'' said Chen Dazhi, president of CCIDNET. ``Red Flag has good products as well as a good management team and is the best Linux producer in China.''
China is eager to protect local software makers before its entry into the World Trade Organization, expected by the end of this year. Local developers have been daunted by competition from global companies such as Microsoft, whose Windows operating systems are installed on about 95 percent of computers in China.
``China wants to control its destiny in terms of the software platform that is used in the country,'' said Matei Mihalca, head of Internet research at Merrill Lynch Asia Pacific. With the Linux operating system, ``there is full transparency in terms of the underlying code.'' [snip]
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