The State Council announced that it will temporarily lift the ban on selling video game consoles.
The ban, which had been in place since 2000, was originally implemented because video games were considered unhealthy for the nation's youth. In agreement with the details of the announcement, "foreign-invested" game console makers will be allowed to manufacture consoles in Shanghai's newly opened free trade zone. Game consoles made in Shanghai would be available for sale nationwide once they pass inspection and review by the relevant Chinese game regulators and "cultural authorities."
The ban on video game consoles has not, however, stopped the Chinese public from enjoying video games. Video gaming, in fact, has exploded in China where in 2013, its revenues eclipsed U.S. $13.5 billion. Unfortunately for video game console makers, the ban has resulted in a whole generation of players having grown up without playing a single game on a console.
Indeed, the vast majority of gamers in China, over 60%, use their personal computers or PCs to play and with people increasingly going online through their mobile devices, even PC games are fighting a stiff competition from mobile and browser based games. Surveys indicate that mobile and browser based games combine for nearly 30% of the market.
The big question is whether or not the major video game console manufacturers, including Sony, Microsoft and Nintendo, will be able to take advantage of the ban lifting. According to market analysts, video game console manufacturers might find success in China if they are willing to lower the price of their consoles and "change their business model" to one that takes advantage of online gaming trends.