Microsoft links up with Tencent, Qihoo, Lenovo

New partnerships enable users to get free Windows upgrades

Microsoft Corp on Wednesday announced a strategic cooperation agreement with several Chinese Internet companies to popularize its next-generation operating system with hundreds of millions of Windows users in the market.

Microsoft is working with the country's leading security firm Qihoo 360 Technology and Internet giant Tencent Holdings, enabling individuals who use antivirus software products provided by the two Chinese partners to upgrade their computers to Windows 10, the next release of Windows, this summer, according to a press release Microsoft e-mailed to the Global Times on Wednesday. The computers would need to have Windows 7 or newer operating systems.

Lenovo Group, the world's largest PC maker, also inked a tie-up with Microsoft to roll out the new operating system in China.

The upgrade will be free of charge, covering all computers, both genuine and non-genuine, said the press release, signifying Microsoft's attempt to gain a larger foothold into the Chinese PC market with pirated software.

A January report by news portal tech.qq.com, based on a survey of 31,110 Web users, showed that 36.8 percent of the participants used pirated Windows operating systems. Although 58.3 percent used the authorized edition, over 80 percent of them got the system preinstalled when they bought PCs instead of buying it separately later.

Analysts said that Windows users in China preferred pirated versions or were lazy with Windows upgrades, because they saw no need to embrace new Windows systems that usually cost hundreds of yuan but feature no distinguishing features compared to previous generations.

Windows 10's predecessor Windows 8 series did not have a warm market reception as Windows 7 did in China after making its grand entrance into the consumers' realm in 2012.

According to the survey, 26.6 percent of the participants use the Windows 8 series, well below the 53.6 percent who use Windows 7.

"Cooperation with the above-mentioned Chinese Internet companies can contribute to the market penetration of Windows 10 in China," Fu Liang, a Beijing-based IT expert, told the Global Times Wednesday.

Qihoo 360's latest full-year earnings report on March 9 revealed that the company's monthly active users in 2014 was 509 million, which reportedly accounted for 96.1 percent of China's antivirus market.

With the help of its partners, Microsoft can also save itself some labor and bandwidth investment in moving Chinese users to Windows 10, said Fu.

Fu's opinion was echoed by Zhang Yi, CEO of Guangzhou-based iiMedia Research, saying the win-win cooperation will allow the Chinese firms to win some new users by offering free upgrades as well.

Zhang told the Global Times Wednesday that slow Windows upgrades on the PC front in China should not be Microsoft's major concern as the US software veteran should worry more about how to extend its presence into the promising mobile sector.

Microsoft has long been trying to make a dent in the mobile sector by working on Windows Phone.

Windows 10, which is built based on shared code for both mobile phones and PCs, appears to be what Microsoft intends to bank on to pave a new path forward for its mobile businesses.

Despite this, Windows 10 may still hardly generate a rise in Microsoft's phone sales, said Zhang, citing a lack of killer applications in comparison with those on Google's Android and Apple's iOS phone operating systems.

Zhang's stance was also reflected in the survey by tech.qq.com, showing that less than 14 percent of the surveyed would like to buy a Windows Phone to go with the new system.

Fu noted that Microsoft's battle with iOS phones and Android phones will be very tough, but the company can still gain a post in the sector if it can ink a partnership with other established smartphone makers and enrich its application portfolios.

Lenovo said in the joint press release that it plans to launch its first Windows Phone in the middle of the year.

Tencent promised to build a Windows 10 app for its popular QQ messaging and gaming services. The fourth-quarter financial report issued by Tencent Wednesday said that QQ had 576 million monthly active users on the mobile front during the quarter, up 33 percent year-on-year.