Mainland computer giant Legend Holdings has completed transactions that will lay the groundwork for the introduction of personal computers installed with software that carries America Online content and services.
The tie-up, first announced in July, represents AOL's first partnership with a hardware maker in Asia. The terms indicate that AOL intends to pursue a strategy in China that proved successful in the United States in the early years of Internet adoption. Trial software bundled on new PCs made it easy for new users to access the Internet, and subscription fees were charged after the free hours ran out.
In a deal that mirrors the complicated structure of many mainland Internet companies, Legend Beijing granted Legend FM the right to Internet access software on the company's PCs.
The deal expires five years from November 20 and carries an exclusivity period of 18 months.
FM365.com, 49 per cent owned by AOL after a US$98 million investment this year, will provide software and services related to the bundling.
Legend FM and FM365.com will receive an estimated annual fee of 208 million yuan (about HK$198.6 million) for each of the first three years.