Microsoft Prepares to Launch MSN China

MSN Solidifies Commitment to Chinese Consumers by Forming Joint Venture With

Chinese Firm and Announcing Strategic Transaction With Chinese Mobile Software

Provider TSSX

May 11, 2005, 01:00 ET from Microsoft Corp.

    REDMOND, Wash. and BEIJING, May 11 /PRNewswire-FirstCall/ -- MSN, the
 online services division of Microsoft Corp. (Nasdaq:   MSFT), today announced it
 has formed a joint venture with Shanghai Alliance Investment Ltd. (SAIL) to
 launch MSN China. The newly formed entity Shanghai MSN Network Communications
 Technology Company Ltd., which received approval from Chinese government
 agencies, is set to deliver popular and innovative MSN(R) products and
 services to consumers throughout China. Microsoft also unveiled plans to
 acquire certain assets of TSSX and enter into exclusive arrangements with the
 company, a prominent Chinese mobile software and services company, to provide
 the foundation for delivering enhanced MSN Mobile products and services to the
 Chinese market and globally.
     (Logo: )
     Although many consumers in China's mainland already use the MSN Messenger
 instant messaging service and the MSN Hotmail(R) e-mail service in Chinese,
 the launch of the MSN China online portal planned for later this spring is
 expected to deliver a comprehensive online experience for China's consumers
 that integrates communications, information and content services. MSN China
 also will create compelling opportunities for advertisers to reach the
 attractive and growing audience of busy professionals in one of the world's
 largest Internet markets. China Internet Network Information Center (CNNIC)
 reported that 94 million Chinese were online in 2004, an 8 percent increase
 over the previous year.
     "The rapid growth in Internet adoption and mobile device usage in China,
 along with the exceptional energy and talent of its people, make this one of
 the most important new markets for MSN," said David Cole, senior vice
 president of MSN at Microsoft. "The MSN China joint venture is a significant
 step in our long-term strategy and commitment to delivering innovative online
 services that help consumers connect with the people and information they care
 most about. Combining TSSX's expertise with the innovative work of our
 developers in Redmond will strengthen Microsoft's ability to create and
 deliver cutting-edge mobile services in China and across the globe."
     The transaction with TSSX marks the first arrangement for Microsoft with a
 company based in China involving mobile Internet services. Overall, Microsoft
 has had a long-standing presence in China as part of its commitment to working
 with government and local industry to support the growth and development of
 China's software and IT industry. As part of the MSN agreement, Microsoft
 plans to form a China Mobile Development Center based in Shenzhen that will
 include TSSX employees and that will integrate TSSX technologies and service
 offerings with those of MSN Mobile. This is expected to enable MSN China to
 quickly provide compelling mobile information, communication and multimedia
 services to Chinese consumers. According to ITFacts, China is the largest
 telecommunications market in the world, with an estimated 340 million mobile
 phone users.
     "Creating a joint venture for MSN China and SAIL and our transaction with
 TSSX signifies the importance Microsoft attaches to the Chinese market," said
 Tim Chen, a Microsoft vice president who serves as chief executive officer of
 Microsoft Greater China. "In addition to delivering MSN services to meet local
 consumers' needs and interests, we are working closely with local companies as
 part of our ongoing commitment to contributing to the growth of the local
 technology industry in China."
     About SAIL
     Founded in 1994, SAIL is a professional investment company funded by the
 State-owned Assets Supervision and Administration Commission of the Shanghai
 Municipal Government. SAIL seeks to strategically invest financial and
 information technology resources toward promoting new economic development in
 Shanghai and other parts of China.
     About MSN
     MSN attracts more than 400 million unique users worldwide per month. With
 localized versions available globally in 40 markets and 20 languages, MSN is a
 world leader in delivering Web services to consumers and online advertising
 opportunities to businesses worldwide. The most useful and innovative online
 service today, MSN brings consumers everything they need from the Web to make
 the most of their time online. MSN is located on the Web at . MSN worldwide sites are located at .
     About MSN China
     Shanghai MSN Network Communications Technology Company Limited is a
 Sino-foreign limited liability equity joint venture company formed by
 Microsoft and SAIL that has been granted a nationwide value added license by
 the Ministry of Information Industry in China.
     About Microsoft
     Founded in 1975, Microsoft is the worldwide leader in software, services
 and solutions that help people and businesses realize their full potential.
     NOTE:  Microsoft, MSN and Hotmail are either registered trademarks or
 trademarks of Microsoft Corp. in the United States and/or other countries.
     The names of actual companies and products mentioned herein may be the
 trademarks of their respective owners.

SOURCE Microsoft Corp.