There has been an uproar in Asia and air of excitement among teens and college students not seen since Mao’s “Cultural Revolution” of 1966, although the throngs filling the street aren’t chanting political slogans, but rather preparing their thumbs for an endless string of sleepless nights battling mythical armies and virtual dragons. On a day when economist revealed China will soon overtake the United States as the worlds leading economy, Microsoft announced that it will begin selling the popular video game console in China, beginning in September.
For the first time in more than a decade, the latest video gaming system will be available to Chinese consumers, a move prompted by the governments announcements that it will temporarily lift a 2000 ban on gaming consoles. Under the terms of the “Shanghai Free Zone” act, foreign companies are now able manufacture game consoles in Shanghai designated zones and distribute them for purchase throughout the country.
In anticipation, Microsoft last year entered into a manufacturing agreement with BesTV, a subsidiary of Shanghai Media Group, in a move Microsoft hopes will help it close the gap with its leading competitor, Sony’s PlayStation 4. Sony has yet to c0mment on Microsoft’s China announcement, although it is near certain the gaming giant will follow in the footsteps of Xbox One’s parent company.
Yusuf Mehdi, Microsoft’s corporate vice president for devices and studios made the announcement through the company’s website, “Launching Xbox One in China is a significant milestone for us and for the industry, and it’s a step forward in our vision to deliver the best games and entertainment experiences to more fans around the world.
Although they have temporary lifted the overall ban, the Chinese government stressed it would censor titles it deemed to promote obscenity, drug use, violence or gambling. The move signals another sign that the Asian giant is conforming to the demands of its citizens, who have shown an increased craving for western entertainment. Over the past two years the government has loosened restrictions on the number of foreign films that could be shown throughout the country.
Microsoft’s partnership with BesTV positions it well to take advantage of the liberalization of China’s attitude on western entertainment. BesTV New Media is a major player throughout the region, whose holdings include Shanghai Information Investment Inc and Funshion Online. The company has also established a relationship with Lenovo, China’s largest personal computer maker, and ZTE Corporation，a leading provider of telecommunications equipment and network solutions. This has led BesTV to build the largest new media industry presence in China.
While its competitors will certainly follow suit, being the first to “establish boots on the ground” in China is a key victory for Microsoft. Since its November launch, Xbox One has consistently trailed the PlayStation 4 in earnings. In most recently released quarterly sales figures, Sony’s PS4 has sold roughly 2 million more units of its popular gaming console than Microsoft.
There are still tangible issues to work out regarding the temporary easing of restrictions. Based on the guidelines presented by the government, it goes without saying that Chinese youngsters wont be enjoying “Grand Theft Auto” anytime soon, but that hardly dampens the excitement already generated. Issues also have to be worked out as related to game updates, often directly uploaded. While industry experts predict this wont apply to minor patches, it does raise concerns that this cause unneeded delays for relatively benign changes. The government declaration also indicated that all games will have to utilize simplified Chinese, meaning that games utilizing traditional Chinese characters, utilized in Hong Kong and Taiwan game versions, cannot be re-sold on the mainland.
Minor details aside the news that Xbox One is coming to China has both investors and teen age boys dancing in the streets.
By Paul M Winters