The end of China’s ban on video game consoles won’t change anything

Who needs consoles when you’ve got cafes?
Who needs consoles when you’ve got cafes?
Image: Reuters
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This week, China said it will lift a ban on selling video game consoles and games in the country, the latest in a series of rules aimed at loosening restrictions on sales. But despite the nice-sounding sentiment that China is opening up, the fact is that not much has changed. And not much will change.

China has “lifted the ban” before—notably in January 2014, when it allowed the sale of the consoles and games in China so long as they met certain conditions, such as being locally produced in a specific free-trade zone. The latest directive simply makes life slightly easier for companies, allowing them to set up them anywhere in the country, as Tech in Asia points out.

Moreover, the change is unlikely to make much of a difference to games-makers, either. A research note from investment bank Macquarie notes that the “initial impact is likely very minimal,” citing six reasons beyond the fact that games are already easily available, both legally and in the gray market. These are:

  • Chinese consumers don’t generally pay for software. At most, they pay for a certain period of play, such as in a gaming parlour, or they play free games.
  • Relatedly, more hardcore gamers are already used to playing on PCs in internet cafes. These players may not be able to afford consoles, but they can afford the hourly rates associated with such cafes.
  • The dominant form of gaming is on mobile phones, which are now powerful enough to compete with consoles for at least the casual games. (Indeed, China’s Snail OS has built an entire business—and a mobile network—on mobile gamers alone.)
  • Chinese developers don’t have much experience making console games, and nor do they much incentive to learn, for the reasons cited above.
  • The same applies to non-Chinese developers, thinks the analysts at Macquarie, who say that “Western and Japanese pubs unlikely to make games that appeal to Chinese gamers.”
  • And the Chinese government will maintain its censorship of certain types of video games, regardless of whether consoles are legal or not. This is in keeping with the government’s policy of enforcing strict moral codes on the media.

In short, says Macquarie, the answer to the question of what impact this will have for large gaming firms like Electronic Arts, “the answer is, unfortunately, very little… at least for now.”