This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Why Dell Comes Out Clean While China Blacklists Apple, Microsoft

Stocks in this article: AAPL MSFT IBM

BEIJING (TheStreet) -- U.S. computer maker Dell has found a way to beat China's rap against American tech companies over alleged security risks: pre-install a Chinese operating system on most of its machines sold in China.

Privately held Dell has thus avoided the costly consequences of a Chinese government computer security campaign that spread Wednesday to include Apple (AAPL) products. Targeted earlier were Microsoft (MSFT) and IBM  (IBM).

Read More: Will Silver Wheaton Deal With Vale for Salobo Gold Mine Pay Off?

Allegations of data security threats prompted the central government's procurement agency to bar Apple products including iPads and MacBooks from future purchases, the Beijing News and other media reported Wednesday. The agency had no immediate comment.

In May, the government said it would stop buying computers pre-installed with Microsoft's Windows 8 operating system and told state-owned banks to phase out IBM servers. Microsoft is also the target of an ongoing anti-trust investigation by the Chinese government.

Dell has so far avoided Beijing's wrath. And the company vastly reduced the risk of future trouble last week by announcing a partnership with China Standard Software, also known as CS2C, which sells a Linux-based operating system called Kylin and lists on the Shanghai Stock Exchange. Terms were not disclosed.

Under the deal, the companies said, Kylin will be pre-installed on Dell's Latitude notebooks, OptiPlex desktops, Precision workstations and other products sold in China. The agreement may expand in the future to include Dell's Vostro computer products.

Read More: 4 Stocks Warren Buffett Is Selling in 2014

Kylin, which means "unicorn" in Chinese, and a related version called NeoKylin are operating systems developed by software engineers at the National University of Defense Technology, an institution jointly run by the Chinese government's education and defense ministries.

Chinese stock analysts in May predicted booming demand for Kylin would follow the government's ban on Microsoft 8. Shanghai shares in CS2C soared after the ban's announcement, but the stock's value since then has flattened.

1 of 2

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs