Lucrative Chinese gaming market opened for game consoles after 14-year-long ban

[David Emmerson Nicholson]

As an avid PS3 gamer, this is most welcome news!

The 'big three' producers of video game consoles, Sony, Nintendo and Microsoft, are eying the uncharted territory of the Chinese $14bn market, after the country suspended the 2000 ban on foreign consoles.

Back in 2000, the Chinese government banned the sale of game consoles in the country citing concerns that they may harm young gamers' mental health. The ban however didn't cover similar areas of the entertainment industry, so now China is a lucrative and fast-developing market dominated by PC, mobile and arcade games. In 2012 it grew by a third and was estimated at $14 billion last year by the China Games Party, an industry-tracking group.

Beijing first announced the plans to reverse the restriction in September last year, and followed on with the plan by temporary and partially suspending the ban. The change allows the sale in mainland China of game consoles produced in the Shanghai free trade zone, a statement posted on Monday on the website of the State Council, the government's top decision-making authority, said. Content of the games will be vetted by cultural departments before they are admitted.

The half-measure is meant as an experiment and will not allow console producers to rush into the Chinese market. For example, the requirement for consoles to be produced in Shanghai makes it impossible to simply redirect the flow of PlayStations, X-boxes and Wiis made in China for foreign markets and benefit from economies of scale.

The producers will also fight an uphill battle for their share in the market. Chinese gamers favor free-to-play games, in which revenue is generated through micro-transactions, like buying for a small fee in-game resources or additional services, or showing third-party advertising. For consoles the business model is based on subsidizing the prices of the equipment and compensating with high price tags of the game titles, a scheme that Chinese gamers may not like.

http://www.rt.com/business/china-game-consoles-ban-304/

[David Emmerson Nicholson]

Haha, good point Chris

Having to buy at the underground place at Hong Xi Jie ps3 games for 200-400 yuan wont change.

[Chris Knight]

What ban?  LOL