In China's Linux market, enter the V-Dragon

Watch out, Wintel--a new "Draglin" is coming to China.

Hong Kong's Culturecom Holdings has combined its Chinese-friendly V-Dragon central processing unit (CPU) with the open-source Linux operating system. The plan is to take on the dominant "Wintel" combination of PCs that run on Microsoft Windows software using Intel CPUs. In its drive to take on Wintel, Culturecom has found powerful allies in IBM, which is making and supporting the new chips, and the Chinese government, which is promoting Linux as a cheaper alternative to Windows.

The V-Dragon chips have scored some initial success since hitting the market last summer, with 1.5 million to 2 million units expected to ship this year, said Benjamin Lau, senior vice president and corporate strategist. The chips sell for $15 to $30 each on average, or well below the cost of a comparable Intel chip with Windows software. "We want to make sure the price can come down, so we've shied away from any Wintel peripherals," he said. Culturecom's two biggest orders to date have come from Taiwanese speaker maker Orient Semiconductor Electronics, for 1 million units over two years, and China's Datang Telecom & Tech, for 300,000 over a year, he said.

Unlike the traditional Wintel systems in which software and chips are separate entities, Culturecom's CPUs come with the Chinese character capability and Linux embedded in the chips. Intel chips now account for nearly 90 percent of the China PC market, while Windows--often pirated--accounts for the vast majority of PC-based operating systems. The country is now the world's No. 2 PC market, with 13.3 million units sold last year.

News source: C|net

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