Red Flag Linux

It's Linux - or Else - in Parts of China
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By Ding Xiao
Radio Free Asia
12/04/08 4:00 AM PT

Authorities in the Chinese city of Nanchang are compelling the city's Internet cafes to replace their Windows operating systems with Red Flag Linux -- and charging them about $726 for it as well. Some cafe owners are closing down rather than comply.


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Authorities in the southeastern Chinese city of Nanchang are requiring all local Internet cafes to replace their Microsoft (Nasdaq: MSFT) Windows XP operating systems with a Chinese-made system, Red Flag Linux , according to officials and Internet cafe owners.

An official with the Nanchang Cultural Discipline Team, which oversees the roughly 600 Internet cafes operating in Nanchang city, said the new operating systems were mandatory.

"We have already started installing the new software in all Internet cafes. All of them must have this new one," the official said.


Piracy Crackdown
The switch was mandated by the Nanchang Cultural Management Bureau in what it said was an effort to crack down on pirated software, local sources said.

But cafe managers said the new system requires a licensing fee of 5,000 yuan (about US$726), and that even legitimate, non-pirated copies of Windows XP were being replaced.

"Our district cultural management authorities came and installed the new Red Flag Linux in all of our 13 Internet cafes," one cafe worker said.

"It happened around Nov. 20, and we all paid the 5,000 yuan installation fee, even though we used to use legally purchased Windows XP. But I don't think this new system is as good as the old one."

A new, legitimate copy of Windows XP costs around 899 yuan (about $130) in China, plus 15 yuan for shipping.

Unwelcome Switch
Whether Nanchang authorities were enforcing an order from higher up, and whether the directive might apply elsewhere in China, wasn't immediately clear.

An Internet cafe owner surnamed Chen said the switch was unwelcome. "Every Internet cafe has to install the new software though none of us wants it. There's no other choice," he said.

"We've been facing a number of new charges. Not long ago, the police asked us to install personal ID scanners for 3,800 yuan ($550). Now we're charged for this new software. We don't know what we will be charged for next. So I wouldn't pay, and I'm closing my business."

Cafe owners complained online this week about paying licensing fees for an operating system that can be downloaded free for personal use.

"How much of the charge goes to the Red Flag Linux Co. and how much to the cultural management authorities in Nanchang?" one post read.

An employee at Red Flag Linux's developer, Beijing Zhongke Red Flag Software, confirmed that the system is free for personal use but couldn't comment on whether businesses are ever required to buy licenses.

Suspected Censorship
The move to Linux is an effort to tighten censorship and step up surveillance online, said Xiao Qiang, director of the China Internet Project at the University of California-Berkeley.

"It mainly means [a] less secure and private communication environment for netizens in those Internet cafes," Xiao said. "The authorities are gaining more control."

"China has a vast number of small Internet cafes, and a huge proportion of them are in a quasi-legal area. By forcing all Internet cafes to change operating systems, the authorities are making them register -- and therefore all kinds of policing and surveillance software will be installed at all these large and small Internet cafes as well."

Red Flag Linux was created by the Software Research Institute of the Chinese Academy of Sciences in 1999. Financial backing came from a government-owned firm, ShangHai NewMargin Venture Capital.

According to the U.S.-based Business Software Alliance , Chinese piracy accounted for almost $6.7 billion in losses in 2007, up from $5.4 billion a year earlier.