After a delay initiated by the Chinese government, Sony’s PlayStation 4 will finally arrive to shelves in China next week. Sony stands to make big gains in China, as the Nintendo Wii U is not available in China and Microsoft’s Xbox One has been relatively lackluster in China thus far. Sony management did detail that the gaming company will be offering several games exclusively in China along with the new consoles.
Chinese government recently repealed law prohibited sale of PS4 and Xbox One
Microsoft’s Xbox One was the first console to hit the Chinese market after the Chinese government decided to scrap a law that prohibited the sale of video game consoles. Thinking the move would be a big success, China has not embraced the Xbox One thus far and certainly represents a warning to Sony. The Xbox One originally went on sale September 29, 2014 and the deluxe bundle with Kinect started at 4,299 yuan, Xbox One with no Kinect lists for 3,699 yuan. The steepness in price was said to be due to the fact that the Chinese version contained more features than Xbox One consoles in other countries, in an attempt to entice further excitement in China. It will be interesting to see how Sony prices out the PS4 and how it will be received by Chinese consumers.
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Chinese consumers not used to pay for games
Another headwind that Microsoft’s Xbox One has gotten in China is the fact that consumers in China are not used to paying for their games. Mobile gaming is huge in China and most apps are free. Some charge for features later in the game, but an upfront lump sum as it would be with the Xbox One is certainly a hefty change from apps. Some in management and analysts had suggested that Xbox develop a similar structure that games are free to download, but would need money later in the game. Microsoft will continue to push traditional Xbox One games, but the company says it will be putting an emphasis on the app style gaming as well. This issue certainly affects Sony as well. How will Sony entice demand amongst Chinese consumers?
Ultimately, China’s consumer market represents a huge growth opportunity for Microsoft and Sony. However, the market they are targeting is used to free app games and relatively cheaper alternatives. Sony must be able to tap this market as well in order to be successful. Sony has had several months to plan and make adjustments from Xbox One’s lackluster opening, we will see what the impact will be with customers.