BEIJING, Jan. 19 -- Leading Chinese Linux software maker RedFlag Software
Co Ltd expects to achieve a 50 per cent growth in sales revenues this year,
pinning hopes on Asianux 2.0, a new product to be jointly launched in July with
Japanese and Korean partners.
"We expect our sales revenues to increase by 50 per cent," said Bai Ke,
RedFlag's marketing supervisor. "Asianux 2.0 will be a great impetus."
The company's board has not approved this year's sales target, "but they
will probably raise that figure," he added.
According to Bai, the company made a profit last year for the first time
since its founding in 2000. The firm's sales revenue last year is believed will
hit US$4 million.
RedFlag is a partner of Japanese developer Miracle Linux and major South
Korean software company HannSoft.
The alliance aims to grab a market share of Asia's rapidly-growing Linux
market, competing with world-leading developers including RedHat Linux and
Bai confirmed reports that the three companies will jointly launch Asianux
2.0 in July, two months ahead of schedule.
"Each company will sell the product in their own brand, and within their
own country," said Bai. "So far we (the three companies) have no plans to tap
other Asian markets."
Bai said the alliance is striving to build a renowned Linux brand, and
possibly a Linux standard in Asia, which is yet to be dominated by a single
Currently RedHat and Novell dominant Linux brands in the North American and
European markets, and have become the de-facto standards in their own regions.
"Asianux 2.0 will put pressure on the non-Asian players," he said.
As a local vendor, RedFlag can provide better services, which is vital to
Linux developers, as they share similar technology behind the software, said
RedFlag commands about 40 per cent of China's Linux market, and the
remaining stake is almost all shared by domestic firms, he added.
However, RedFlag's foreign competitors do not feel threatened by the new
"The Asian companies' alliance is unlikely to grow into a third powerful
force in Linux," said Lolley Luo, marketing and channel director of Novell
Novell is the world's No 1 Linux developer, thanks to its acquisitions of
two Linux solution providers - Ximian Inc in August 2003 and SuSE Linux in
Indeed, the absence of a major player makes the emergence of a regional
brand possible, but "the alliance won't work well," he said.
Unless one of the companies plays a dominant role in the alliance, the
three members will face direct competition when they expand into markets outside
their own, although this is unlikely to happen soon, Luo said.
"And this is proven by the failure of UnitedLinux," he added.
UnitedLinux, formed in 2002 by four Linux vendors - Caldera, Conectiva,
SuSE Linux and Turbo Linux - and committed to building a single, worldwide Linux
standard, disbanded "as a result of such internal conflicts,"Luo said.
Moreover, world-leading IT product vendors do not often certify many Linux
"But a single company brings a monopoly. Therefore two is enough, and now
the consumers have Novell and RedHat," he said.
However, a number of IT hardware providers including IBM, Dell,
Hewlett-Packard, Sun Microsystems and NEC have showed their support for Asianux
and have agreed to certify the product.
Novell signed an agreement last Wednesday with leading Chinese IT solutions
provider Neusoft Group on promoting Novell's professional Linux training
programmes in China.
"Despite the fast-growing demand for Linux talent in China, employers still
find it hard to find qualified Linux engineers," said Greg Embleton,
vice-president of professional services and solutions at Novell Asia-Pacific.
"In 2005, we will continue to invest heavily in the Chinese market and
remove enterprise barriers on Linux's deployment," he said.
Novell entered China last March. To date, it has set up a Chinese
subsidiary, headquartered in Beijing, and an office in Shenzhen.
Meanwhile, Chen Shi, general manager of RedHat's Greater China Region,
said: "we are glad to have counterparts in East Asia; they are not rivals."
The Linux industry is still in its infancy in China and RedHat has been
stressing co-operation among developers to expand the market, he said.
RedHat set up a Chinese subsidiary last November to help tap the country's
booming Linux market.
Commenting on RedHat, Luo said: "the company seems to have achieved little
so far... but we have made breakthroughs in the government, banking and telecoms
Novell last year secured deals with leading Chinese telecoms equipment
vendor Huawei Technologies on Linux solutions. RedHat and RedFlag were among its
Yet according to Cao Kaibin, an analyst at leading research firm CCW
Research, RedHat is much more popular among Chinese Linux users.
"But that contributes little to their revenues since most Chinese download
versions of Linux free from the Internet."
(Source: China Daily)