Security concerns prompts ‘gold rush’ for Chinese enterprise computing market

Concern over the security of Windows in China has led to a ‘gold rush’, as Chinese firms race to fill the gap left by Microsoft’s operating system, reports Reuters.

The report explains how the revelations of American whistleblower Edward Snowden in 2013 has led to the country looking to replace Microsoft’s Windows operating system, adding that Windows 8 has been banned by Chinese leaders “in retaliation” to the company ending support for the aging Windows XP OS, earlier this year.

This has led to a ‘gold rush’ of software developers seeking to take control of the $450 billion-a-year enterprise computing market.

It’s not just software developers who are seeking to take advantage of the sudden gap in the market. According to the report, the bidders for Hongqi (the most successful Chinese OS developer back in the early 2000s) included “a coal magnate, an aviation company and a food transport provider.” In the end the company went to a business with a background in household cleaning for $6 million.

The country’s IT industry has been shaken up by the shockwaves of privacy revelations in the West. As He Weijia, one of Hongqi’s former directors puts it, “We’re in a new bubble because of Snowden. These bosses don’t need that much money or expertise to get into the game, but the payoff can be potentially large.”

Start-ups are also flourishing in the new conditions, and some believe these may be the best bet for investors looking to predict the future. “This is obviously an area that the government wants to develop or promote – how is this different from Baidu in 2003?” asked a Chinese partner of a Silicon Valley venture capital firm. Baidu, the Chinese search engine, first appeared a decade ago, but is now valued at more than $75 billion.

How quickly the infrastructure can change is anybody’s guess though, especially as banks are said to be ware of using new software on their servers. As Qiao Yong, a Standard Software vice president puts it, “Some leaders think we can do this overnight, but it will take a very long time to reach a one-third market share, much less reach Microsoft’s level.”

Author , ESET

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