China is lifting its ban on video game consoles

26 Jul 2015 | Author: | No comments yet »

China has finally legalized game console sales—for real this time.

China will lift a ban on making and selling video game consoles in the country, paving the way for foreign companies like Sony and Microsoft to expand in one of the world’s largest video game markets. While PC and mobile gaming have long been major attractions in China, the big three console makers — Microsoft, Nintendo and Sony — were all, as foreign interests, stuck on the outside. Now, according to the Wall Street Journal, the country’s Ministry of Culture said that foreign and domestic console vendors would soon be able to manufacture and sell their wares in the People’s Republic.

Previously, regulators limited foreign console makers, such as Sony and Nintendo, to operate only in the Shanghai Free Trade Zone, which stifled sales and potential growth. China’s gamers – having adapted to Beijing’s attempt to protect its youth from supposedly unhealthy content – are big fans of massively multi-player online role-playing (MMORPG), which work better on PCs than consoles. The move opens the door to a valuable market of video gamers who have turned to computer and mobile video games because of limited access to consoles like Microsoft’s Xbox, Sony’s PlayStation and Nintendo’s Wii. “This is great news for us,” a Sony Computer Entertainment spokeswoman said, adding that the company remained committed to the console business in China. While that represented a major turnaround for the long-closed Chinese market, it also put a definitive ceiling on sales potential for console makers outside the country.

Game consoles were first banned in 2000 due to fears that the devices — and the 3D worlds produced by them — had a negative effect on the mental and physical development of children. While the ban on consoles has been officially lifted for several months, console makers like Microsoft and Sony Corp were forced to funnel their systems through Shanghai, which is home to China’s experimental free-trade zone. Gaming companies have long had their eyes on the Chinese market but have faced restrictions since 2000, when Chinese regulators enacted a console ban to prevent what they said were potential adverse effects on China’s youth. Restrictions that are normally in place throughout the rest of China are relaxed in the free-trade zone, allowing the government to test out new regulations and economic models before expanding them to other parts of the country.

But even those relaxed restrictions proved to be a major hurdle to console-makers, which had to enter into contracts to build new manufacturing facilities in the area. Console sales had first been allowed within the confines of Shanghai’s free-trade zone before the ban was finally lifted, and until now the city has remained the sole port of entry for foreign game systems.

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