Microsoft Corp, which recently appointed a new China CEO and announced a US$1-billion budget for research in China, said yesterday it would cut the retail price of flagship software products Windows and Office by up to 60 percent.

Consumers have linked the price cut to Microsoft's "black screen" crackdown on pirated software, but Microsoft denied it.

Microsft's crackdown started in October. People using unauthorized Windows or Office applications see their screens turn black or show pop-up alerts every hour.

The move caused controversy with Netizens who called it a "monopoly act" and complained of the high price of genuine Microsoft products. Microsoft said in October it would adopt a "more flexible" price strategy in China, the world's No. 2 personal computer market.

In its new promotion, Microsoft has reduced the price of Office Home&Student (the three-installation package) from 699 yuan (US$101) to 398 yuan from January. From this month, Microsoft will make the WGA Kit XP Home Edition available in China for 399 yuan, down from 960 yuan. This offer will last until December 31 next year.

The company also expanded the National Holiday sale of Office 2007 H&S (one installation package) for 199 yuan so that it lasts through the Spring Festival. Windows Vista Home Basic will remain at 499 yuan.

"Microsoft is constantly listening to the China market and its consumers. We are committed to communicating with our partners to better enable us to adopt adaptable strategies in the local market," Simon Leung, Microsoft's newly appointed chairman and CEO of China, said.

During the global financial crisis, China is probably the only region to increase investment in information technology while US firms have cut spending, industry insiders said.

About 40 million PCs are sold in the Chinese market annually, officials said.

(Shanghai Daily December 9, 2008)