Chinese Linux hit by credit crunch

Davey Winder
Thursday, 11 December 2008 15:42

Business IT - Open Source

Linux has been doing pretty well in China, with recent year-on-year sales going through the roof. However, there can be no escaping the global economic crisis, not even for Chinese Linux.

Some have been insisting that the credit crunch will not impact upon IT spending and others have been embracing Linux as a new religion.

In China, despite some hiccups with Lenovo, Linux has been going from strength-to-strength. Indeed, Chinese research outfit CCID Consulting has published a report showing that Linux sales grew, year-on-year, by some 17 percent in China during the first three quarters of 2008.

Unfortunately, when you get past that headline figure, the report does not make great reading for those who thought that both Linux and the Chinese Economy were bulletproof.

It also reveals that the Chinese appetite for Linux is slowing down considerably, and puts the blame squarely at the feet of the global economic meltdown. "Investments in informatization are becoming more cautious, the postponing and cancellations of system construction have led to a drop in Linux shipment" CCID says.

CCID also admit that open-source server application development and implementation, particularly within 'new' markets such as banking and telecoms, have yet to be properly cultivated and remain firmly ensconced around the periphery.

The report does highlight the strength of Red Flag Software, though, stating that it "continues to actively take part in Intel Moblin project and exert force to mobile Linux market" and that "projects in government, education and transportation field guarantee its largest market share in China's Linux market..."

However, there is no escaping the inevitable conclusion that the growth rate of China's Linux market will not return to the previously enjoyed highs. At least not for the foreseeable future. "IT purchasing budget will reduce, limiting centralized purchasing decisions" CCID concedes.

Oh well, at least the spam distribution curve continues to grow in China. That remains one Chinese market the credit crunch cannot take away.