Since 2000, console makers have been banned from producing and selling gaming consoles in China. This was in order to prevent what Chinese regulators called “adverse effects on youth.” They had eased restrictions somewhat last year in a pilot test program, which was successful according to a statement from the Ministry of Culture. As a result, the Xbox One launched there on September 29th of last year and was followed by the PlayStation 4. This easing of restrictions allowed console makers to produce and sell consoles, but only within Shanghai’s free trade zone. Now, China’s Ministry of Culture is lifting the ban completely, allowing console manufacturers to produce and sell their consoles anywhere in China rather than being limited to operating within one very small area.
China’s gamers have largely turned to PC and mobile gaming, due to the very limited nature of gaming consoles in their country. Companies like Nintendo, Microsoft, and Sony will be better able to expand into this market, but it may be a tricky road. Since China’s gamers have long since turned to PC and mobile platforms for their gaming fix, consoles will have to win them back. Thus, consoles have a lot of catching up to do if they are to compete with PC and mobile games in China’s video games market. It is a market estimated to be worth $22.2 billion (up %23 from last year) according to research firm NewZoo BV.
This full lifting of the ban will allow console manufactures to become much more active within China. They will in turn be able to increase production so their consoles can become much less limited there. Though Microsoft and Sony jumped into the market relatively quickly after the limitations were eased last year, their returns weren’t so great due a number of things. One reason was being limited to operating in a very small area, which of course led to limited supplies of consoles. Now that the ban is being lifted, this is good news for the giants of the console gaming world. Only time will tell how well consoles will be able to compete with PC and mobile gaming in China after being absent for so long.
