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  • February 1995 (Revised August 1995)
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Microsoft in the People's Republic of China, 1993

By: Tarun Khanna
  • Format:Print
  • | Pages:20
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Abstract

Explores some of the economic and political tradeoffs that need to be negotiated by a firm seeking to influence industry structure. The setting is the nascent personal computer software industry in the People's Republic of China (PRC) in 1993. Microsoft has to localize its software products for use in the PRC. This localization can either be done in-house by Microsoft, or can be contracted to the local software vendors. Explores the costs and benefits of full integration and arm's-length market transaction. Also discusses the "holdup" problem that arises when assets specific to a particular partnership are created.

Keywords

Cost vs Benefits; Product Marketing; Market Entry and Exit; Market Transactions; Industry Structures; Partners and Partnerships; Vertical Integration; Software; Information Technology Industry; China

Citation

Khanna, Tarun. "Microsoft in the People's Republic of China, 1993." Harvard Business School Case 795-115, February 1995. (Revised August 1995.)
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About The Author

Tarun Khanna

Strategy
→More Publications

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More from the Author
  • Firm-Induced Migration Paths and Strategic Human-Capital Outcomes By: Prithwiraj (Raj) Choudhury, Tarun Khanna and Victoria Sevcenko
  • Your Company Needs a Space Strategy. Now. By: Matthew Weinzierl, Prithwiraj (Raj) Choudhury, Tarun Khanna, Alan MacCormack and Brendan Rosseau
  • AES Corp: A Global Power Transformation By: Tarun Khanna, Allison M. Ciechanover and Matt Higgins
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