Ballmer in a China shop: Microsoft invests $750m

Microsoft is to invest $750m in China over the next three years in a push to develop a legitimate software market in the country.

The company's CEO Steve Ballmer yesterday signed an agreement with China's state development commission during a two day visit to the country.

Microsoft has previously come into conflict with Chinese officials, complaining that they have not done enough to tackle the software piracy which is rampant throughout the country.

While the agreement contains no restrictions or regulations on software piracy, Microsoft said it was confident a thriving domestic software industry would encourage the Chinese government to improve copyright laws.

Speaking yesterday at a news conference to announce the deal, Ballmer said: "There's no real commitment that I would say is part of the agreement that we signed. We want the Chinese industry to grow. The success of Microsoft in every market, including China's, is highly dependent upon the growth of local industry. What's good for the local industry in every country is good for Microsoft."

Over the next three years Microsoft will also invest $24m in Chinese educational and research institutions and will provide $480,000 to set up a software college in Shanghai.

While specifics of the deal have not been released, Ballmer said it would cover outsourcing, exports, local training and development.

He said China had not made any specific pledges in return.

Microsoft has been paving its way into China for some time now. The company last year worked with a state-owned software firm to improve encryption on Windows.

Earlier this year it announced joint ventures with two Chinese software firms. It has also inked a deal with phone maker TCL Mobile to base future models on Microsoft's mobile platform.

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