China is demanding a written explanation for compatibility issues with Windows and Office in 20 days. The State Administration for Industry and Commerce (SAIC) has been questioning Microsoft in an anti-monopoly investigation, and suspects that it has not fully disclosed issues relating to the compatibility.
Part of the problem seems to be verification codes that Microsoft bundles with its software. Most software vendors use a similar technique to battle piracy. It is hard to imagine how this is monopolistic, as everyone does it.
If these allegations don’t make sense to you, then you’re probably still sane. None of this makes any sense, and it’s hard to imagine how Microsoft can fix this problem. China is well known for piracy problems, and not just on Microsoft software. Microsoft makes less revenue in China than it does in the Netherlands!
In a related note, Qualcomm met with China’s National Development and Reform Commission (NDRC) for an investigation into the San Diego semiconductor giant for overcharging and abusing its “market position in wireless communication standards.” So this does seem to be a more widespread problem, one every oversees company should potentially be worried about.
Microsoft, for their part, has said that it is “serious about complying with China’s laws and committed to addressing SAIC’s questions and concerns” with CEO Nadella scheduled to make his first visit to China this month.