Yang's comments provide a rare insight into the fees manufacturers pay to sell PCs with Windows, information that Microsoft traditionally keeps under wraps.

Yang stressed the importance of protecting intellectual property to foster the development of China's own software industry. In China, PCs are often sold without an operating system because most Chinese consumers have low incomes and are deterred by the additional cost.

China's PC buyers are easily able to purchase pirated software, including Windows, for a few dollars at street markets throughout the country. However, in December, Lenovo began pre-installing Windows on all the own-brand PCs it sells in China, Yang said.

Lenovo shipped 13.9 million notebook and desktop PCs worldwide in 2005, up 222 per cent from 2004, and increased its market share to 6.4 per cent, Primasia Securities of Taiwan said today, citing data from US-based research firm, iSuppli. Approximately seven million of those computers were sold in China.