CCID Consulting’s research shows that the sales revenue of China’s Linux market in the first three quarters reaches 126.6 million Yuan, up 17% year-on-year. In 2008Q3, China’s Linux market’s growth rate slows down; the sales revenue reaches 45.5 million Yuan, up 29% year-on-year.

The main reason for slowdown is global finance crisis. Clients’ investments in informatization tends to be cautious, they postpone or cancel system construction, which results in Linux shipment’s drop. Besides, open-source application in server-end still around the periphery of the core application, banking and telecom demands for Linux need to be cultivated.

Market competition reflects as mature solution ability and comprehensive strength competition
With clients’ higher requirements for manufacturers’ technical level and comprehensive strength, manufacturers transfer from selling single product to providing solution. Clients hope manufacturers to provide integrated solutions and successful cases, so manufacturers’ competition tends to alliance and comprehensive product strength.

Red Flag Software continues to actively take part in Intel Moblin project and exert force to mobile Linux market. Red Flag Software cooperates with application manufacturers, such as Tencent QQ and Alipay, and OEM partners, such as Lenovo, aigo, BenQ and Hitachi to promote MID; it cooperates with ISV to promote Midinux . Meanwhile, its projects in government, education and transportation field guarantee its largest market share in China’s Linux market in 2008Q3.

Novell and Microsoft have two years’ cooperation. They continue to promote mixed source solutions, which acquires telecom-grade clients’ recognition, such as Guangdong Mobile.

China Standard Software puts forward integrated solution, which integrates Office, desktop and server; China Standard Software cooperates with PC vendors and ISV partners to build reliable philosophy and customized system, so China Standard Software continues to keep growth.

Red Hat cooperates with Jboss to carry through product promotion, vitalization technology promotion. Red Hat cooperates with Sinosoft so as to improve its market position; it also gains achievement in China Unicom’s IDC data center.

All Linux vendors seek more market application through product line convergence and alliance cooperation.

Government stimulating domestic demands and special project construction drive the growth of China’s Linux Market in 2008Q4
CCID Consulting forecasts that the growth rate of China’s Linux market in 2008Q4 is difficult to return to a high level. Because of client’s control in 2008Q4, IT purchasing budget will reduce, so centralized purchasing situation will rarely appear.

On the other hand, because of users’ intense capital, some users choose to purchase high cost performance Linux system. Meanwhile, with the influence of government stimulating domestic demands, governments, railway, civil aviation, architecture and health care industries will have favorable prospect. Red Flag Software and China Standard Software have made some breakthrough in railway ticket system and social charity and medical informatization fields.

Linux open-source’s ecological improvement will drive long-term development
After many years’ user training, some enterprises have realized that open-source software have greater productivity. They could enjoy collective wisdom result with low cost. Chinese government actively promotes legal copy policy, which drives Linux development. CCID Consulting’s research shows that users in North China, East China and South China could easily accept open-source software; the demands in central China grow rapidly; open-source software application in northeast, northwest and south west is in start-up stage.

In open-source software ecological chain’s supply-end, open-source vendors receive the international enterprises’ capital, technology and hardware support, such as IBM, Intel, SUN and Oracle. Open-source software’s software and hardware support platform has large improvement. As for support services, more industrial ISVs take part in open-source chain, provide consulting and implementation services for open-source products, and develop more applications to satisfy users’ requirements. It is forecasted that China’s Linux market will keep stable growth.