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Microsoft pumped up its system builder network this week with investments in support and marketing, including a Buy Local campaign that drives business customers to local OEMs.

Microsoft is giving its system builders and distributors tools, marketing and demand generation programs in an effort to help them become more competitive in a marketplace increasingly squeezed by the largest OEMs.

“System builders and distributors are under constant pressure from competition in the channel as well as from larger OEMs,” said Kurt Kolb, vice president of Worldwide System Builder Channel and License Compliance at Microsoft.

“Over the past several months we’ve been working to create, tailor and extend benefits for system builders to address the needs of these companies, which are a critical component of not only our own sales channel, but also the overall health of the PC industry.”

Key to Microsoft’s effort is the Buy Local campaign, which uses a Web portal to identify system builders by location and entice customers with promotional bonus pack of software for each copy of Windows XP purchased from a system builder that in turn has purchased the software from a Microsoft authorized distributor.

On March 15, Microsoft will expand the offering to include an additional bonus pack worth up to $1,200 that includes a free D-Link wireless router (after a $50 rebate).

Since the campaign launched in October, nearly 600,000 customers have visited the Buy Local Web site; thousands of system builders have downloaded the site’s marketing support materials, and more than 85,000 customers have used the locator tool to find a local system builder, Microsoft said.

“We’re really starting to see the impact of our increased investments come to fruition today,” Kolb said.

“Our system builder partners are telling us that the benefits such as Buy Local and the cooperative marketing fund are helping them better compete and differentiate themselves in the market.”

Microsoft has also seen benefits from an OEM Hardware Solutions Competency it launched in November to deliver internal-use software, branding and marketing materials to proven system builders. To date, more than 1,000 system builders have enrolled.

Partnerships between system builders and Microsoft’s Small Business Specialist Community have also helped to move system builder’s product to more small business users, Microsoft said.