Microsoft Faces China Backlash to Windows Amid U.S. Spat

 China’s government took another step against Microsoft Corp. (MSFT) by telling officials in one province not to use Windows 8 software, marking an escalation in the dispute with the U.S. over spying and hacking allegations.

Jiangsu province, south of Shanghai, canceled purchases of computers running the software in February after receiving a government notification, according to state-run China Central Television. A computer-science professor told the broadcaster that Windows 8’s security features benefit Microsoft “and that poses a big challenge to the national strategy for information security.”

microsoft_small Microsoft Faces China Backlash to Windows Amid U.S. Spat

The CCTV report comes after China said it would vet technology companies, and the Central Government Procurement Center excluded Windows 8 from a purchase of energy-efficient computers. Those moves follow indictments by U.S. prosecutors of five Chinese military officers for allegedly hacking into the computers of American companies, and former contractor Edward Snowden’s revelations of a National Security Agency spying program.

Microsoft, the world’s largest software maker, said it is committed to retaining the trust of its customers worldwide.

“Our Government Security Program allows governments to review our source code to confirm there are no back doors,” Kathy Roeder, a spokeswoman for Redmond, Washington-based Microsoft, said in an e-mail. “Customers around the world have evaluated and embraced Windows 8 as our most secure operating system.”

IBM Servers

Microsoft said last month it was “surprised” to learn of that central government’s decision. The official Xinhua News Agency called the national procurement center’s decision last month “a move to ensure computer security.”

Beijing’s municipal government has complained about the cost of Windows 8 being too high, and several local governments have dropped the operating system in favor of locally developed alternatives, the state broadcaster reported in yesterday’s midday newscast, according to a clip on its website.

Alternatives include Ubuntu Kylin.

China’s government said last month it will vet technology companies operating in the country, and the Financial Times reported May 25 that China ordered state-owned companies to cut ties with U.S. consulting firms.

China is also reviewing whether domestic banks’ reliance on high-end servers from International Business Machines Corp. (IBM) compromises the nation’s financial security, people familiar with the matter said last week.

In 2012, Microsoft asked China to stop the alleged use of pirated versions of its Office software by four state-owned companies, three people familiar with the matter said at the time. Microsoft alleged that more than 40 percent of Office and Windows server client software used by China National Petroleum Corp. was unlicensed, the people said.

China’s illegal software market in 2011 was worth about $9 billion, compared with a legal market of less than $3 billion, according to the Business Software Alliance.