SAN FRANCISCO -- A government-sponsored software development group in China unveiled a version of the Linux operating system it has developed that it said will eventually replace Windows and Unix on all of its government PCs and servers.

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Called Yangfan Linux, which means "raise the sail" in Chinese, the open source operating system is being pieced together by the Beijing Software Industry Productivity Center, a group established by the government to organize Linux development in China. A delegation from China detailed the announcement Tuesday at LinuxWorld here.

Now six months in the making, Yangfan has made its way on to 2,800 government computers, replacing Windows and in some cases early versions of Linux already running inside the government, said Guangzhi Jiang, director of the Beijing Software Industry Productivity Center, during a press conference Tuesday.

The source code for Yangfan was made available last week under the GNU General Public License. The group is now collecting feedback and will continue improving the operating system.

Nearly 100 software engineers from 18 organizations, including universities, private sector as well as the Taiwanese government, have contributed to the project. Some of its major achievements include developing a graphical user interface that aims to simplify Linux for the desktop.

The group has also done significant work localizing the operating system to support Chinese-language characters, which will be contributed back into the Linux community, according to Jon "Maddog" Hall, director of Linux International, a nonprofit Linux advocacy group that has been working with the Chinese government.

"A lot of the work they are doing in localization also affects other languages," Hall said.

The Beijing Software Industry Productivity Center said it is aiming to duplicate about 70 percent of the functionality of Microsoft's Windows 2000 operating system. It is also working to add various hardware device drivers to the operating system.

"We have a long way to go to improve it," Jiang said.

Yangfan is based on two distributions of the Linux operating system. One is the distribution developed by Chinese Linux vendor Red Flag Software. The second is a version of the operating system called Cosix Linux, developed by China Computer Software Corp.

In addition to an operating system, the Beijing Software Industry Productivity Center is developing office applications and other Linux-based software to sit on top of Yangfan. The group's goal is to develop an entire desktop environment with open source technology for the government, Jiang said.

China's government first threw its weight behind Linux in 1998 and has since made it a driving force in the country's software development industry. However, Linux accounts for only about 2.2 percent of the operating system market in China, compared to 45 percent of the market held by Windows, according to market research provided by the Chinese government.