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XTeam, a Linux software developer, will list on Hong Kong's Growth Enterprise Market today, as part of its bid to push penguin-power into Mainland China.

Having shifted its focus from trying to attain market share on the desktop level, the company is now hoping to target the burgeoning server market in the region, using the HK$21 million (nearly £1.9 million) raised to open an office in Shanghai (its existing head office is in Beijing), expand its product development and set up a training and certification programme.

Typically, Linux has a price advantage over Microsoft software, being free, but this advantage is lost in China where most people either buy or download pirate versions of the software. On this level-playing field and with Microsoft having coded better Chinese support into its software, its applications tend to be more popular, says Lawrence Sheed, a Shanghai-based Webmaster.

According to him, most Microsoft applications are easily available in shops for about one dollar, about 50 cents more than the average cost of a blank CD there. For the download option, a quick check on a Chinese warez site confirms a long list of the newest applications from various software companies easily available for download.

However, with Microsoft ramping up its efforts to legitimise software and curb the rampant piracy problem in the region - most notably by recently convincing four major PC makers to bundle legal versions of Windows XP in their consumer PCs - Linux could improve its position in the market.

To do so, it needs people on the ground in major cities to support it, as well partnering with and influencing systems integrators and data centre operators to recommend Linux to their customers, which is precisely what XTeam plans to do.

It's not going to be an easy ride; the company faces stiff competition from other Chinese-language Linux developers.

Only a tiny fraction of the estimated 260,000 servers sold in China last year brandished the Linux flag, with Red Flag, TurboLinux and XTeam comprising about 70 per cent of the fledgling Linux market, reports the South China Morning Post. ®

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