Microsoft also unveiled plans to acquire certain assets of TSSX, a prominent Chinese mobile software and services company, and enter into exclusive arrangements with the company to deliver the MSN mobile products and services globally.
It marks the first Microsoft venture with a Chinese company in mobile Internet services. The MSN Messenger instant messaging service and the MSN Hotmail e-mail service in Chinese is popular in China. The launch of the MSN China online portal was expected to integrate communications, information, and content services, and create opportunities for advertisers to reach the one of the world's largest Internet markets, the statement said.
Some 94 million Chinese were online in 2004, an eight percent increase over the previous year, according to China Internet Network Information Center (CNNIC).
As part of the agreement, Microsoft plans to form a China Mobile Development Center based in Shenzhen that would include TSSX employees and integrate the Chinese firm's technology and service offerings with those of MSN Mobile, the statement said.
That could enable the MSN China to quickly provide mobile information, communication and multimedia services to Chinese consumers, it added.
China has an estimated 340 million mobile phone users, the world's biggest telecom market.
"Creating a joint venture for the MSN China and SAIL and our transaction with TSSX signifies the importance Microsoft attaches to the Chinese market," said Microsoft Greater China chief executive officer Tim Chen.