cold fjord writes with news that Red Flag Software, makers of China's Red Hat derivative Red Flag Linux, has halted operations. From the article: "Once the world's second-largest Linux distributor, Red Flag Software has shuttered reportedly due to mismanagement and after owing employees months in unpaid wages. China's state-funded answer to global software giants like Microsoft ... filed for liquidation over the weekend and terminated all employee contracts. Set up in late-1999 amid the dot-com boom, Red Flag was touted as an alternative to Windows ... It thrived in the early days, inking deals with partners such as Oracle and Dell which products were certified to support and shipped with Red Flag Software. The Beijing-based vendor was primarily funded by the Chinese Academy of Sciences' Institute of Software Research, and later received additional funding from state-owned Shanghai NewMargin Venture Capital and the Ministry of Information Industry's VC arm ... 'A lack of brand awareness and sustained investments, coupled with the rise of rivals including Red Hat Enterprise Linux and SuSE Linux Enterprise, led to its downfall,' Eric Peng, Beijing-based research manager with IDC, said ... Peng noted that, during its hey days, Red Flag had enjoyed high adoption among government agencies, state-owned organizations, and schools.""