Video game console makers still face hurdles after China lifts ban

Now Reading:

Video game console makers still face hurdles after China lifts ban

Text size Aa Aa

It is not clear exactly how video game console makers will benefit from China temporarily lifting a ban on selling them.

It was imposed 14 years ago by the government to protect young people from corrupting influences.

It did not work, instead they play online and personal computer games, making China the world’s third-largest gaming market in terms of revenue.

But it did mean a whole generation grew up without a Wii, PlayStation or Xbox.

Imports remain banned, but China’s ruling State Council said it might allow consoles to be made in the Shanghai free-trade zone.

Nintendo, Sony and Microsoft would have to partner with Chinese firms in joint ventures.

But even if they can make consoles in China, they face the additional problem that many young Chinese gamers do not earn enough to buy the consoles that are popular elsewhere in Asia and around the world.

More than 70 percent of Chinese gamers earn less than 4,000 yuan (486 euros) a month, according to Hong Kong-based brokerage CLSA, less than the price of a new Xbox One in Europe.

Another possible hurdle is the availability of illegal consoles, which are modified to run pirated games.

Shares in Nintendo did jump as much as 7.5 percent to a two and a half-year high on the news even as a Nintendo spokesman said the company was still unsure what the opportunities were in China.

Sony, whose business extends beyond game consoles, didn’t get a share price bump.