This chapter looks at implications of the emerging global intellectual property (IP) regime for developing countries (DCs) and their attempts to improve their technological capabilities. It further highlights the new perspectives for DCs opened up by the emergence of non-proprietary (open source/free) software, such as Linux. A case study of the battle between Microsoft and Linux in China is used to explore the dilemmas faced by China in determining what IP regime (strict or weak) to adopt, and the threats and opportunities that either may pose for indigenous technology development. Based on the case analysis, the chapter criticizes the simplistic polarized views that have been presented of the implications of the global IP regime and of the potential of non-proprietary software. It explores some of the complex considerations about the interplay between technology strategy and IP protection for China and discusses the policy implications for China and other DCs.