Microsoft’s Long Past and Uncertain Future in China
A look at Microsoft’s China business, including what’s left and the concessions it has had to make in order to stay.
Bill Gates meets with then-Chinese President Jiang Zemin, February 2003. Aiming to assuage Chinese concerns over the security of their network, Microsoft agreed to allow Chinese authorities to view the source code for its flagship operating system, Windows XP. A year earlier, the software giant had also established a joint venture with an investment firm run by Jiang's son. Credit: Liu Weibing, Xinhua/AP Photo
LinkedIn is quitting China: but what of its parent, Microsoft, and its links to the world’s second-largest economy?
Seattle-based Microsoft has one of the longest relationships with China of any major Western tech company. Founder Bill Gates has met every Chinese leader from Jiang Zemin to Xi Jinping. Yet the returns on this long strategic investment are looking pretty meager these days. Microsoft garnered just 1.8 percent of its 2019 global revenue in China, company president Brad Smith said in January 2020.Microsoft reported about $125 billion in revenue in 2019.
Doing business in China is getting tougher for Microsoft, along with other foreign tech firms. LinkedIn cited “a significantly more challenging operating environment and greater compliance requirements” among its reasons for leaving (although it left out those points in its Chinese-language explanation).
This week, The Wire looks at Microsoft’s China business, including what’s left and the concession
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