According to the agreement, Founder will sell Microsoft keyboards, webcams and other hardware in more than 500 stores across China. The company plans to pre-install Windows on all consumer PCs and approximately 40% of its business computers. Earlier, PC makers in China did not preload the operating software, letting consumers install legal software on their own.

Our partnership with Founder is an essential part of our strategy here in China and around the world, said Steve Ballmer, Microsoft’s chief executive.

According to industry group Business Software Alliance, China is one of the leading source of illegally copied software, music and other goods. About 82% of software was pirated in China last year compared to the Asian regional average of 55%.

Founder, among the top five PC vendors in China, only preloaded Windows on consumer PCs under an earlier agreement with Microsoft.

In a separate deal between these two companies, Founder had agreed to pre-load Microsoft’s Windows Live system, which includes programs for e-mail, instant messaging, blogging and sharing photos, on PCs equipped with Windows for the next two years. This also includes Microsoft’s search service, Live Search, which competes against Chinese Baidu.com and US based Google. Financial terms of the two agreements were not disclosed.

Microsoft has been working on tie-ups with Chinese equipment makers to stop use of unlicensed copies of its products.

In March 2007, another Chinese PC maker, Lenovo, had partnered to pre-load Microsoft’s tool bar and web search software on its personal and business computers. Lenovo also has agreed to pre-load Windows LIVE in laptop and desktop computers.

Source: ComputerWire daily updates