Electronic-business specialist BEA Systems is to build its first offshore software development lab in the mainland as part of an aggressive two-year expansion plan. Co-founder, president and chief executive Alfred Chuang said the move was supported by China's emergence as the company's fastest-growing market, deregulation of domestic industries under the World Trade Organisation and the increasing number of skilled mainland staff. The expansion programme is also being spurred by BEA's release this spring of new e-business software products, targeted at China's large public sector, as well as the country's evolving telecommunications, banking and finance, manufacturing, and construction industries. Mr Chuang said: 'I am very encouraged by the developments in China. That is why I'm going to make my move in the next 18 to 24 months. We plan to set up our first offshore software development lab there with 100 to 200 people.' BEA, after five years of planning and discussions with authorities, established two months ago its directly owned subsidiary in Beijing, BEA Systems (China), with more than 100 staff. Financial details of its mainland investments were not disclosed. Mr Chuang said the formation of the subsidiary now enabled the company to sell its software directly to customers. Previously, its software sales relied on distributors in Hong Kong and the mainland. The company's offices in Beijing, Shanghai, Chengdu and Guangzhou will serve as the main hubs from which it will sell software and provide services to customers in every province. 'Services form a big part of our expansion strategy as we aim to do a lot of hand-holding of customers in all the provinces where we sell our products,' Mr Chuang said, adding that alliances would help push forward the development of its customer base in the country. BEA bolstered its services programme when it announced earlier this month an alliance with Deloitte Consulting. Based in Silicon Valley, BEA is one of the world's leading application infrastructure software companies, with about 12,000 enterprise customers worldwide. It has 96 offices in 34 countries, with about 15 per cent of total sales coming from Asia. Despite stiff competition from IBM and Oracle, BEA and its WebLogic e-business platform has emerged as the de facto standard for more than 2,100 major systems integrators, independent software vendors and application service providers around the world. Its application server software has been ranked No 1 worldwide by research firm Gartner. For its third financial quarter to October 31 last year, BEA posted total revenues of US$219.6 million, including licence fees of US$126.6 million. Mr Chuang pointed out BEA's performance last year, like that of most software companies, was affected by the economic downturn. He said: 'Still, we are encouraged by the 2,838 deals we completed in that quarter, which was roughly the same number as we did in the second quarter. Customers continued to invest in new applications, and continued to choose our platform. But, obviously, in this environment they are being more cautious and investing more slowly.' The company is looking to broaden its market as the economy starts improving and with the release this spring of a new WebLogic suite product, which incorporates its integration, portal and personalisation application server software. Mr Chuang said that BEA's future developments in China would rely on a growing number of Western-educated Chinese who were now returning to the mainland to share their expertise. 'We aim to be more local than American, and I'm encouraged by the growing pool of technically skilled local talent we can now find in China,' he said. Although his plans for BEA are driven by business and market opportunities, the Hong Kong-born chief executive noted that there was also some national pride at stake. Mr Chuang said: 'We all know that Asia is the fastest-growing region in the world, with China's growth being the most encouraging and its drive to succeed the most impressive. Out of our 400 staff in Asia Pacific, our China team has been one of the most dynamic. China's entry into the WTO is a clear indication that the country is poised to become the economic powerhouse of this century.' He added: 'As the leader of BEA Systems, I will do my best to drive BEA's participation in China's information technology development, its local talent, technology, products and services. 'We will continue to strengthen our extensive co-operation with China's IT industry in whatever ways we can, and play an active role in the country's development.'