China to lift console ban – will tense Japanese/Chinese relations damage Sony and Nintendo?

xbox one china

It is no secret that China is an emerging superpower and with the changes that are being made in the country, as it modernises, are set to affect the world at large.

With a reported 250 million people set to move from the countryside to cities over the next twelve years, the potential market for luxury entertainment products is set to be amongst the largest in the world as both the lower and middle classes become more affluent.

To videogame platform holders, China is an untapped vein of gold – and that market just became a little more open.

China looks set to overturn a 13 year ban on foreign video game consoles which was instituted because of fears surrounding the detrimental effect videogames could have on children.

league of legends chinaWhilst gamers in China have turned to the black market to source consoles or instead elected to play PC games such as the hugely popular League of Legends, the dissolution of this ban marks the first time that the Chinese public at large will be exposed to videogames.

China’s State Council stated that “foreign companies will be able to sell consoles across the entire country as long as they have established production and sales operations in the free trade zone [in Shanghai].”

The time frame for China to move from this ban to selling foreign games consoles over the counter across the country is loosely defined as being between now and 2016. The full list of new rules and regulations surrounding the console ban lift are forthcoming, though it does appear that investment in Shanghai’s free-trade zone and the Ministry of Culture’s final approval are both required.

This potentially game changing news comes alongside Microsoft’s announcement of a joint venture with Chinese company BesTV worth around $237 million.

The venture will reportedly bring games, gaming related products and entertainment-related software to China and whilst spokespeople for either company have declined to comment on specific products, considering BesTV’s television and media credentials, an Xbox One release appears to be a given.

That said, given the disparity of wealth between China’s booming upper classes and the lower classes set to move to cities over the next decade, any move by Microsoft, Sony or Nintendo into the region are likely to include both current gen and next gen products, so as to appeal to as many Chinese citizens as possible.

anti japan riots in china 2
Could damaged Japanese/Chinese relations impact Sony or Nintendo’s chance of success in the world’s second largest economy?

Microsoft have had notable failures in Japan and other Asian territories though in China, it could be set to triumph. The long simmering tension between Japan and China over disputed island territory and lingering resentment over World War Two era atrocities could negatively damage any move by Nintendo or Sony into Shanghai’s free-trade zone. In a 2013 BBC World Service Poll, a reported 74% of Chinese people view Japan negatively – considered alongside 2012’s anti-Japan riots which saw Japanese businesses and products destroyed or boycotted, it would not be unsurprising to find China’s reaction to Japanese consoles to be ambivalent or even oppositional.

China is the second biggest economy in the world and with the Government’s proposed rapid-modernization, the market for entertainment products looks set to boom – if one platform holder gains a substantial foothold in China then the potential lead that they would have over their competitors could be huge.

The potential ramifications of a large Chinese market on the videogame industry’s platform power struggle are far reaching and game changing – forget Europe or the US, the next gen console war could be decided in China.

Twinstickgaming will bring you more as this story continues to develop.

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