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Beijing had threatened to fine non-complying PC makers, but manufacturers appeared to be ignoring the deadline, The Financial Times reported.

The end of the standoff may only be temporary. The Ministry of Industry and Information Technology, in a statement issued Monday night and reported by the official state-run news agency, Xinhua, said the program can always be installed later.

The Financial Times said independent tests show that the software -- which Beijing says is a parental control program only -- has censorship functions and could make personal computers vulnerable to cyber-attacks.

The standoff began last month after Beijing ordered PC makers to start pre-installing or "bundling" Green Dam/Youth Escort, an Internet filter software developed in China. The Financial Times said the demand was met with security concerns among PC makers and anger among Chinese who use the Internet.

The Financial Times reported Chinese retailers said they had received no PCs bundled with Green Dam and there was no possibility manufacturers would meet the deadline.

The ministry said there was no change in policy, which now can be implemented in stages. The ministry also said it had consultations with PC makers in March and had gotten broad support for the new filter.

The ministry claimed the software had been downloaded 7 million times at locations that included Internet cafes and school computer labs.

Acer, the world's third-largest PC maker, is only manufacturer to say publicly it expects to comply with the order to pre-install Green Dam, the newspaper reported.

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