China To Launch Its Own OS, Defying NSA Spying & Microsoft

The Chinese government has made it official: it is launching a computer operating system to replace the likes of Microsoft Corporation (NASDAQ:MSFT) Windows, a move that was first indicated in a May ValueWalk report.

China to launch computer operating system by October
Reuters is reporting that China’s state-run media, People’s Post and Telecommunications News, an official trade paper run by the Ministry of Industry and Information Technology (MIIT), is reporting the official development.

“We hope to launch a Chinese-made desktop operating system by October supporting app stores,” Ni Guangnan, who heads an official Chinese operating system development alliance, was quoted in press reports as saying.

As ValueWalk reported in May, China banned government use of Microsoft’s Windows 8 operating system, a move construed as being due to US National Security Agency spying.  In addition to Windows 8 being banned, Microsoft is the subject of an anti-trust investigation in China.

China has long been a troubling market for Microsoft. In 2011, for instance, former chief executive officer Steve Ballmer reportedly told employees in that year Microsoft earned less revenue in China than in the Netherlands, even though China’s computer sales matched those of the US.  The reason given was due to computer piracy.  The new Windows 8 operating system is said to have more sophisticated tools that identify and track individual users with one goal to reduce software piracy.  For its part, last may the official Xinhua news agency said the ba was to ensure computer security after Microsoft Corporation  ended support for its Windows XP.

Apple creating new server configuration for Chinese customers
The moves in China appear to have a “tit for tat” motivation to various degrees.  While security from prying NSA eyes is obviously a concern, recent moves on both sides of the Pacific Ocean underscore the increasing importance China is placing on data security.  Nearly ten days ago, for instance, ValueWalk reported on Apple Inc. (NASDAQ:AAPL) Computer creating a server configuration for Chinese customers that was located in China.  In May the US Justice Department indicted five Chinese military officers on counts of extensive industrial espionage, much of which took place via computers.

The storage would include datagathered from cell phone usage, a key source of US National Security Agency spying.  Instead of storing data in the US, Apple Inc. would store user data on servers provided by China Telecom Corporation Limited (ADR) (NYSE:CHA) (HKG:0728) , China’s largest wireless carrier, according to a statement from Apple.

Although a report said Apple attributed the move to an effort to “improve speed and reliability of its iCloud service,” it is well known, as previously reported in ValueWalk, that NSA spying is a significant issue being considered worldwide and impacting the bottom lines of many tech giants.

The Reuters report noted that “mutual suspicions between China and the United States over hacking have escalated over the past year following revelations by Edward Snowden that U.S. intelligence planted ‘backdoor’ surveillance tools on US-made hardware.” Other sources have indicated that foreign spy services were broadly aware of US electronic spy capabilities before the release of information by Edward Snowden.