Microsoft has announced that it has signed an agreement with China Standard Software Co. Ltd. (CS2C) for the joint development and marketing of cloud computing solutions in China. The agreement, the specific terms of which are confidential, is described as a "mutually beneficial customer legal covenant agreement", that will provide mixed source public and private cloud solutions based on Microsoft's Hyper-V Open Cloud architecture, and including support for CS2C's NeoKylin Linux Server products.

In its report, ZDNet stated how it had asked Microsoft if this legal covenant agreement was the "same patent-protection deal that Microsoft has forged with other Linux vendors", such as Novell/AttachmateSUSE, Onkyo, Amazon, and General Dynamics and Velocity Micro; these vendors pay Microsoft patent royalties on their Linux implementations. The Microsoft spokesperson declined to respond.

The press release quoted Simon Leung, chairman and CEO of Microsoft Greater China Region: "We have come together with CS2C through our shared belief that technology is both a critical mechanism for organizations to realize their potential, as well as a catalyst for innovation and economic growth."

Microsoft and CS2C, the leading Linux operating system provider in China, also announced that they would jointly sponsor a virtual technology lab in Beijing to develop and test cloud solutions. In particular, the lab will work on the certification of CS2C's NeoKylin Linux Operating System running on Windows Server 2008 R2 with Hyper-V, "creating Microsoft Systems Center management packs for CS2C NeoKylin Operating System application workloads, and incorporating support for CS2C NeoKylin Operating System within the Hyper-V Cloud architecture."

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