Last January, China announced that it was lifting a 14-year ban on videogame consoles, allowing for the drafting of regulations that would allow gaming companies such as Nintendo and Sony to produce and sell gaming products in Shanghai’s free trade zone. With the regulations now officially in place, Microsoft has beaten its competitors to the punch, and the Xbox One will be the first console to be legally sold in the country since 2000.
The deal was made possible through Microsoft’s partnership with BesTV New Media Co., an IPTV firm that is also a subsidiary of Shanghai Media Group. They are looking to launch the Xbox One on Chinese shores this September.
Part of the announcement on the Xbox website reads:
On behalf of the entire Xbox team, we are incredibly excited to bring Xbox One and the next generation of games, entertainment, online education and fitness to China. Launching Xbox One in China is a significant milestone for us and for the industry, and it’s a step forward in our vision to deliver the best games and entertainment experiences to more fans around the world.
With over a billion people, China’s gaming market has the kinds of numbers that would make any executive at Sony, Microsoft or Nintendo desperate to get in on the action. Nearly half a billion of its population plays videogames, which is more than the entire population of the United States, and last year the country’s gaming industry saw a 38% growth in revenue at $13 billion. This is especially remarkable considering that 89% of Chinese gamers play on PC.
However, the journey to reintroducing consoles to the country will be fraught with challenges. For one thing, while the Chinese government has lifted its ban on consoles, which it initially claimed were destroying the mental health of young people, it has not lifted its ban on videogames containing things like violence, drug use, gambling, racial hatred, or anything that can be remotely considered blasphemous or insulting to China.
Additionally, many Chinese gamers are accustomed to playing free-to-play games. Piracy is rampant across the country, and it beggars belief that many of them will be willing to fork out $500 for an Xbox One, especially considering that 70% of Chinese gamers earn only about $600 a month. Microsoft have not officially announced a price for the Chinese Xbox One, however.
Still, Wedbush Securities analysit Michael Pachter is more optimistic: “Keep in mind that Apple is marketing very expensive iPhones and iPads there, and they sell well, so likely the Xbox One will as well.”
Microsoft’s Xbox division in China will be headed by Enwei Xie, who said that “Creators and gamers alike have eagerly awaited a new generation of entertainment experiences in China, and their wait will be over with the arrival of Xbox One this year.”