Turbolinux to Advance Linux Market Leadership Position in China; Leading Linux Distributor Has Secured Subsidy to Expand Linux Growth in China and Deployed Operating Systems in Sichuan Province.

TOKYO -- Turbolinux, Inc., a global leader of Linux-based solutions, today announced that the company has successfully negotiated with the Chinese government to obtain high-tech innovation funding and has also expanded the availability of the Linux open source software in the Sichuan Province, located in southwest China. "The strong relationships we have developed with the Chinese government, as well as the several advantages Turbolinux offers to our customers there, including a strong presence in Beijing and our software's ability to handle Chinese characters, has positioned us as the market leader in China for four successive years," said Koichi Yano, president and COO of Turbolinux, Inc. According to market research firm IDC, Turbolinux holds a 62% share in the Linux server market and a 24.9% share of the Chinese desktop OS market in 2004(a).

To accelerate its "High Availability Enterprises Cluster Software" project, Turbolinux applied for and received a subsidy from a technological innovation fund created by the Chinese government and approved by the China State Affairs Administration. The fund is designed to support science and technology ventures by small and mid-sized enterprises, and to promote the development and application of high technology.

Moreover, Turbolinux has also launched Turbolinux HA, a server OS and software cluster, across Sichuan Province, the vital economic and political center of southwestern China. State-run health provider, Sichuan Province Health Agency, and major communications providers, Sichuan Mobile and Sichuan Netcom Communication, are currently integrating Turbolinux HA, known for its large-scale access and high load generation, into mission critical server systems.

As a leader in Linux operating systems, Turbolinux has been committed to improving the information infrastructure in China and has implemented several successful projects within various Chinese e-government initiatives. In 2004, Turbolinux deployed critical operating systems across China's National Railway System, designed to centralize package delivery operation and management. That same year, China launched its most powerful supercomputer, the Dawning 4000A, using the Turbolinux operating system. Turbolinux has also contracted with China's Shanghai Jing'an District e-government projects, China Mobile and ICBC, China's largest commercial bank, to adopt Turbolinux operating systems and software.

Given the growing popularity of the Linux server OS market and positive indicators for growth set forth in market analyses, Linux plans an aggressive expansion in the commercial and business market in China, as well as in India, Vietnam and other Asian countries. Turbolinux is committed to providing flexible, open source computing solutions and infrastructure support for the expanding base of Linux customers in Asia and participating in the region's technological transformation.

About Turbolinux, Inc.

Turbolinux develops and sells the leading Linux distribution in Asia-Pacific. The operating system is optimized to run on a wide range of hardware platforms, including Intel-based servers and IBM mainframes. Turbolinux, with headquarters in Japan and offices worldwide, plays a major role in developing Linux systems for the Japanese market, including Japanese and Chinese language "double-byte" text support. More than half of Turbolinux's staff is dedicated to Linux engineering development and support, providing expert support and custom application development services that go beyond Japanese localization issues. Turbolinux works extensively with standards bodies and partners to ensure certification and software compatibility in all business environments. For more information, visit the corporate website at www.turbolinux.com.

(a) Source: IDC, "China Linux 2005-2009 Forecast and Analysis"

Turbolinux is a trademark of Turbolinux, Inc. Linux is a trademark of Linus Torvalds. All other product or service names are the property of their respective owners.