Microsoft Opens the Gates: Patent, Piracy, and Political Challenges in China
- In China Microsoft has to face different challenges on business, patents, and governmental level as the challenges faced by Microsoft include Chinese pressure to disclose the technology which is competitive advantage of the company, discrimination based on the procurement policies, number of lawsuits by different local organizations, and others. These challenges seem to increase in the future because Chinese government’s protectionist policies are unique and aggressively followed. Although, these protectionist measures probably tend to decrease gradually into the future because there might be win-win situation for the company and China. It is because Microsoft has plenty of opportunities to share with China so far as software expertises are concerned.
- Microsoft is aware of the Chinese political policies which are aimed at transferring the knowledge and expertise to the local companies as well. Therefore, Microsoft aims to transfer expertise at local level as it gives special importance to make the relations better with government at national and local level. For example, it opened IT training center in Wuxi which is aligned with the development initiatives for the city by the government. One of the other initiatives of Microsoft includes investment of $280 million for development of research and development center in Beijing. These transfer of knowledge and expertise at local level is very assisting for China because software industry and industrial growth is on increasing trend in China and Microsoft’s help in this regard is very prospective.
- Lower levels of government are vital in dealing for Microsoft in the context of its business prospects in the country. In fact, at national level the government is concerned with technology transfer and protectionist policies while challenges and opportunities presented to Microsoft at lower level are different. Regional and local governments within China have their unique interests which become very important for the corporation especially in the cities and regions where national government is taking serious steps for development. Although, Chinese government make policies at national level but the importance of local governments is very important because they have instrumental role in local procurement, operations, and other strategies.
- Microsoft has high stakes in the country because it is one of the biggest global players in the software category and so far as technology and software companies are concerned the risk management options for all companies re same. For example, Google faced unique challenges in China and it has to abandon some functions and features but Microsoft did not do that and aggressively made efforts to abide by and adapt itself according to the rules and regulations of the Chinese environment. Risk management options for Microsoft are wide because it has plenty of options to deliver to the local players in software industry and the challenges posed by the Chinese government are not danger because China is the fastest growing software market and Microsoft is working good in China as compared to other companies because it has wide options so far as the risk management options are concerned.
- Microsoft has taken many initiatives which are unique in China from global operations because it has heavy stakes in the fastest growing software market of China. Transferring the expertise and knowledge to local companies might become serious in future because the issue of piracy and theft of competitive advantage is major challenge for the company in China. However, risk management initiatives adopted by China include nurturing partnerships at local level, in-depth relations with China and Chinese corporations, and strategically Microsoft-oriented software center in China so that in future the software trends become oriented with Microsoft software expertise. The transfer of knowledge should be done in rational manner because China is renowned for its piracy and it makes the software by copying them. Thus, Microsoft should deliver local specific knowledge only otherwise transfer of competitive advantage might negatively affect the company into the future.
- Not relevant to Google, Microsoft tends to follow the rules and regulations according to local adaptations and Microsoft does not show any indications to change its operations regarding to censorship at internet levels. Google’s challenge on the censorship of internet might put the corporation on challenging conditions as Microsoft might need to ensure censorship as well. For Microsoft, censorship is easier than Google’s decision for it because Google is a search engine while Microsoft is a software company.