Sun Microsystems will provide China Standard Software (CSSC) with one million seats per year of its Java Desktop System.
The Java Desktop system consists of the Gnome desktop environment, StarOffice applications, the Mozilla browser, Evolution mail and calendar software, Java 2 Standard Edition and a Linux operating system.
The CSSC is a consortium of Chinese technology companies which executes government technology initiatives.
The agreement is part of a worldwide, government-led trend toward open-source systems.
The European Union, India, Thailand, the Philippines, Vietnam and other countries are either investigating open source or have already adopted policies to embrace it.
So far, however, those open-source efforts have held little sway with US companies and federal, state or local governments.
Linux advocates believe the agreement will raise the visibility of alternative operating systems in the US.
Jeremy White, chairman of the Desktop Linux Consortium, said the China decision, as well as the growing use of open-source systems in other countries will, eventually, influence businesses in this country. If a large bank in the UK, for instance, were to switch to open-source software, a US bank may consider it too.
White also said he believed open-source systems are attractive because they may be easier to tailor to local languages and cultural needs.
James Love, who heads Consumer Project on Technology, has been urging the federal government to demand open standards in government IT contracts.
He said Sun's announcement was a clear signal that governments are beginning to opt for alternatives to Microsoft products.
"People are beginning to focus on the fact that once you crack the standards, you don't have a monopoly anymore," he said.
"This does raise the profile of people adopting alternative operative systems in large numbers," said technology analyst Rob Enderle. He called the China deal a very important win for Sun.
Sun did not disclose the price of the deal. It lists its system at $100 per desktop user or $50 per seat for existing Java Enterprise users.
Patrick Thibodeau writes for Computerworld