Disclosure: The organizers of ChinaJoy are paying for my trip to Shanghai. Our coverage remains objective.
Like Richard Nixon, the Xbox One is going to China.
China Telecom will sell Microsoft’s new video game console starting in September under an exclusive contract, Reuters reported. China Telecom, the third-largest telecommunications company in the country, said today that the console will be offered to China Telecom’s 30 million broadband customers.
The deal could be a good one for Microsoft, which needs to find Chinese partners to help make its launch successful. PC and mobile gaming are hot in China, where game consoles have been banned by the government since 2000. But the government has relaxed that policy. Microsoft has not yet set a price for the console, which sells for either $400 (without Kinect) or $500 with Kinect in the U.S.
Market researcher Newzoo expects China to overtake the U.S. as the world’s biggest game market by 2016 with $25 billion in revenue, according to market researcher Newzoo.
The Chinese launch will be a hot topic next week at ChinaJoy, a huge game conference which I will be attending in-person and reporting on for the first time.
Lisa Cosmas Hanson, managing partner and analyst at Niko Partners, said, “I know China Telecom has been experimenting in the console-alternatives market for some time now. It would be strange if Microsoft and BesTV limited their audience to China Telecom’s customers only, so it seems they will also sell through other channels. The comment by the Microsoft China spokesperson indicates that as well, though the word ‘exclusive’ is confusing.”
Last year, Microsoft reached a deal with Chinese internet TV set-top box maker BesTV New Media Co, Ltd., to form a joint venture to manufacture the consoles in Shanghai’s Free Trade Zone.
Released in November, the Xbox One hasn’t sold as much as Sony’s PlayStation 4. Sony also apparently wants to sell the PS4 in China, but it has made no detailed announcements on that.
In a statement, Microsoft said, “China Telecom announced that Xbox One will be available for purchase through China Telecom as part of its broadband Internet data plan packages. The company selected Xbox One to be the exclusive console of choice for their Smart Home initiative, making it available to its 30 million China Telecom broadband customers. When Xbox One launches in September, in addition to the China Telecom consumer offer, it will be available to the general public for purchase at retail and online.”