Red Flag Linux first appeared in August 1999, when it was created by the Institute of Software Research at the
Chinese Academy of Sciences. Financial help came from government-owned Shanghai NewMargin Venture Capital. In March 2001, Bloomberg News reported that CCIDNET Investment, a venture capital arm of the Ministry of Industry and Information Technology, had become Red Flag's second largest shareholder. During a brief standoff with Microsoft in January 2000, in a year-long series of increasing tensions believed to have been tied to Microsoft's perceived mismanagement of its
Microsoft Venus venture, Chinese government ministries were ordered to uninstall
Windows 2000 from their computers in favor of Red Flag Linux. In January 2006, Red Flag Linux joined the
Open Source Development Labs. An
Equation Group leak from 2017 included tools that targeted Red Flag Linux.
2014 Closure/Restructuring On 10 February 2014, Red Flag Software terminated all employment contracts and closed down. The direct cause of the closure was cited as being the failure of the Chinese Academy of Sciences' Software Research Institute to pay a 40 million yuan subsidy. The institute cited Red Flag's failure to complete a specific project, and general mismanagement, as reasons for not paying the subsidy. According to a research manager with IDC in Beijing, its downfall resulted from a lack of brand awareness and sustained investments, coupled with the rise of rivals. ==Nanchang Internet cafes==