Microsoft signs huge software deal with Lenovo

Microsoft signs huge software deal with Lenovo

On the first stop of a Chinese business delegation's US trip, Lenovo Group penned a deal to buy more than US$1 billion in software from Microsoft.

Although the signing ceremony took place in San Francisco, a Beijing-based spokesman for Lenovo detailed the deal to Reuters and XFN wire service reporters. According to Reuters, Lenovo committed to purchasing Windows XP, Windows Vista, Microsoft Office and other software from Microsoft.

"Our projection is the price tag could be as much as $1.3 billion for this fiscal year," the spokesman told Reuters.

Altogether, the Chinese delegation committed to buying $4.3 billion in U.S. technology and signed 27 contracts with Microsoft and other companies, including Cisco Systems, Hewlett-Packard and Oracle.

In April 2006, Lenovo and Microsoft sealed a similar deal for $1.2 billion that reaffirmed a November 2005 pledge the two companies made in an effort to get legitimate copies of Windows on Chinese PCs. China has long been a counterfeiter's haven, with bogus copies of software the rule rather than the exception.

The deals are just part of a multistate swing through the US by 200 Chinese companies. The so-called "buying mission" is a regular event, and the latest attempt by China to mollify the US. Later this month, the US and China will hold government-level talks in Washington about the $232 billion American trade deficit.

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