Others News
- Lenovo to buy US$1.3bsoftware from Microsoft
Date: 14-May-2007 Sources: (Shenzhen Daily)
LENOVO Group Ltd. has signed a deal with Microsoft Corp. to buy Windows, Office and other software suites for its personal computers in a deal worth as much as US$1.3 billion.
The agreement emulates one inked in 2006, worth US$1.2 billion over one year, to pre-install Microsoft's Windows operating system software on Lenovo's computers, deemed a major step in China's efforts to combat piracy.
A Beijing-based spokesman for China's largest PC maker said Thursday that the framework agreement, encompassing this fiscal year, had been signed Wednesday in the United States.
'Our projection is the price tag could be as much as US$1.3 billion for this fiscal year,'the spokesman said. 'Last year's agreement was executed very well.'
Both firms hoped to advance 'one of the most important goals of international business: the protection of intellectual property,'Lenovo senior vice president Chen Shaopeng, who attended the signing ceremony, said in a statement Thursday.
In November 2005, Lenovo became the first personal computer manufacturer to pre-install Windows on all of its product lines for the Chinese market.
The move followed a Chinese Government decree that required all PCs made in China to have licensed operating software installed before leaving the factory, as part of the government's efforts to crack down on piracy.
Details of the 2007 purchasing agreement would be finalized later, the Beijing-based spokesman said.
Lenovo now sells pre-installed Microsoft software on computers sold in more than 65 countries around the world.
Microsoft and Lenovo last month announced they would build a joint research and development innovation center in China, marking Microsoft's first such endeavour with an OEM partner, it said.
The center will focus on technologies for the China market and concentrate on mobile devices and ways to build products on top of Microsoft's software, it said.
Lenovo - one of several Chinese companies trying to craft an international brand - commands a dominant market share in Asia excluding Japan but faces fierce competition from Dell Inc. and Hewlett-Packard elsewhere.
The Chinese firm is now vying with Taiwan's Acer Inc. for the mantle of the world's third-largest PC manufacturer, tracking behind Hewlett-Packard and Dell.
Lenovo has also been grappling with expenses arising from layoffs and corporate streamlining after its US$1.25 billion purchase of IBM's PC arm in 2005.
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