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[Mario007]

They entered an agreement with a Chinese company and gave them 51 % of the Xbox business in the FTZ. I think people don't understand that these consoles don't go to China. China is closed off. But China opened the Shanghai Free Trade Zone to test the ground for a more open approach. So these 5 million Xbox Ones and 200k annual PS4s (if they get approved) are not for all of China. They are to be sold only in the trade zone which is an area of about 30 km^2.

This is wrong. You operate out of the FTZ. Sony has already stated that they plan to manufacture parts of the PlayStation consoles there to fall within the regulations. The consoles are then sold all over China.

Again, MS got an approval for 5 million Xbones to be sold in China. Sony stated that they plan to produce 200k a year. That's absolutely not the same. Technically we haven't heard how many PS4s did Sony get approved in China yet.

Oh and both Sony and MS have formed JV with Chinese companies, where the Chinese partner owns 51% of the JV. That was mandated. Sony, however, formed a second JV where they own 70% which should deal with software, marketing, licensing and external support so kind of like SCEE/SCEA/SCEJA

 

[SwiftDeath]

Well at least it's something of an update so there's that

 

[chopstik]

Sony is probably allocating fewer units to China because they have fewer untits to allocate to china. Where MS has a lot more units to allocate to China (they aren't selling as well).

This.

Xbox one sales are still lagging, this shouldn't be a surprise.

 

[Mario007]

Developing countries are mostly PC gaming driven due to most people playing games in netcafes. Consoles are an exotic novelty that until very recently did not officially exist in their markets.

While true the console market in China has never been tested before. From official sources we know that the console markets in South East Asia has grown tremendously just by seeing the increase in the sales of PS4 compared to the PS2 era. Similar situation can be seen in India as well. So while the Chinese market will be PC focused (though less and less online PC client games focused) and mobile focused for the foreseeable future, to simply dismiss consoles in the region is ignorance at best.

 

[Dryk]

Xbone wins China via negotiating skills. Probably paid more to China government per unit.

Not being Japanese puts them ahead in the negotiations by default

 

[Mario007]

This.

Xbox one sales are still lagging, this shouldn't be a surprise.

This line of thinking is also incorrect. The console, or at least some of its parts, has to be manufactured in the FTZ somehow. Otherwise it won't gain governmental approval. So this is not a case of MS having 5 million spare Xbox One's and getting them to China. In fact the fact that China approved 5 million Xbone sales doesn't mean that there are 5 million Xbones sitting at the warehouses in China ready to be shipped. Instead, the government simply capped MS's Xbone sales at 5 million subject to further negotiations. We haven't heard of a similar cap for PS4 despite the misleading title of this thread.

 

[Chaos2Frozen]

Not being Japanese puts them ahead in the negotiations by default

So China secretly friends with US confirmed right?

 

[Kikujiro]

Developing countries are mostly PC gaming driven due to most people playing games in netcafes. Consoles are an exotic novelty that until very recently did not officially exist in their markets.

But he was clearly refering to the console market, sorine post was uncalled for.

 

[fedexpeon]

So China secretly friends with US confirmed right?

Well yeah, they invest a lot of their money into US treasury bills, notes, and bonds.
China owns 8% of our public held debts.
1.3 trillion is a large number though, and if you aren't "friendly" with each others...bye bye investment.

 

[Mario007]

So China secretly friends with US confirmed right?

So friendly they forced MS to delay the xbone launch just a day or two before it was to go on sale for shits and giggles (ie to flex muscles).

 

[LOLCats]

Well yeah, they invest a lot of their money into US treasury bills, notes, and bonds.
China owns 8% of our public held debts.
1.3 trillion is a large number though, and if you aren't "friendly" with each others...bye bye investment.

Well there's always repossession.

Fcking autocorrect.

 

[BumblebeeCody]

So China has all the Killer Instinct players. Sony need to get the Resogun crowd.

 

[Psycho_Mantis]

Pretty sure MS is allowed to sell 500 million worldwide.
MS wins?

don;t you know, unit caps = guaranteed sales.

 

[Maximilian Kolbe]

So friendly they forced MS to delay the xbone launch just a day or two before it was to go on sale for shits and giggles (ie to flex muscles).

That's because the free trade zone opened at 2013 Spet 29, so Chinese gov force them released the console at 2014 Spet 29

Yeah stupid, but that's Chinese gov.

 

[Steel]

I don't get it. Why even allow consoles to be sold in china if you're gonna limit the number this much?

 

[KyanMehwulfe]

a lot of the challenge is how entertainment as a whole is consumed... basically everyone I know that is Chinese not only has zero interest or care in video games (whether it's in China or Vancouver or any of those I keep in touch with on social media) but also everything from cable television to, well, televisions. almost everyone does everything on just a laptop, whether it's streaming American movies and drama or the latest episode of Voice China. even all the very wealthy princelings I know, who all love Alienware laptops because of Big Bang Theory, rarely use TVs for anything. Many of them don't even have a TV and even those that do, they still don't connect their laptop half the time and end up just using Funshion on their bed lol I have to constantly tell my wife or her parents to use a TV or at least a tablet because they just insist on staring on their phones or laptops all the time (and I see this all the time with friends and families, otherwise I wouldn't use it as an anecdote). The whole concept of the living room 'entertainment center' is just so rare, so even if most of my Chinese friends even received a PS4 as a gift, it wouldn't fit into their home or how they consume entertainment in the least.

there is potential there... once in a while I'll we'll have some other couples over from our grad school and quite a few of them enjoy GTA V a lot when I leave it on for anyone to play with while we all socialize... and quite a few of them have a blast. None of them express any interest of having it at home though. And most genres aren't really interesting. Basketball is pretty popular and Vancouver also has a lot of super car owners, and I've showed sort of similar appealing games to friends with these interests and it's a pretty fleeting interest --- cool and entertaining for an hour but zero interest after. Almost every one of them plays mobile or laptop games though. Almost every guy I know plays LOL and nothing but LOL... maybe the odd MMO 'whale' (and they spend insane amounts). Everyone, even the girls that never play games, know CS... but that's it. It's mostly just either LOL if they're hardcore gamers, and if they're casual gamers stuff like Candy Crush, card games like dou di zhu, and maybe a few battle card/farming sim type games. All types of folks, from people poorer uni students to richer students that own homes/supercars, to folks that have been grad 4-5 years, almost all play either LOL if they're into games, or casual card/puzzle/sim games if they're not really into games. And basically everyone streams drama on Funshion/PPstream.

So it's really not as simple as just entering China, or even showing that the games are fun. The problem isn't whether or not people will find PS4 games fun -- of course they will. It's more that a video game console doesn't naturally fit into how folks consume content. Video games requiring a TV is a big limitation because people prefer their mobile devices. I've never once seen a story game played before; it's usually all competitive games you can easily pick up, play, and abandon. No one ever buys or pays for movies, dramas, or games. Everything is streamed for free with very professional and big business marketing for revenue. The notion of a $60 game or renting a movie for $5-10 is absolutely insane. Most folks I know think it should be free and if it needs to generate revenue then it should have advertising. So the whole TV entertainment system, big narrative games at $60 a pop or under subscription provide so many significant barriers beyond just whether or not they're fun. It's never been about that.

 

[ThoughtsOfSpeaking]

I think people should stay away from these China threads because its clear that neither side knows what the hell they are talking about.

 

[King Beyond the wall]

I doubt we'll see ms reach anywhere close to 5 million in China, or even 1 million, but 200k per year for ps4 does not look like much

 

[SuperSah]

Well, that's a low figure.

 

[1.21Gigawatts]

Whats the logic behind such a cap?
Why does it exist?

 

[PuppetMaster]

Makes total sense if Chinas quota is based on total number of frames per second...

 

[Coulomb_Barrier]

It is a number game.
If Sony is limited to 200k, consumers will have to use the grey market or import the device.
But for the mainstream, that would be too hard of an option so MS will win by default since Sony will have a huge supply constraint on them.
I believe after selling/shipping 100k, MS is estimating they will sell 1M by the end of next year.
Sony? Only 400k if all will be sold out next year. That is a huge gap that Sony will never be able to catch up if the government will continue to limit Sony product.



Well, I don't how can you negotiate to a government that gave 5M to a competitor straight up from the get go when that same government would only allow another to produce 200k/annually.
The negotiation will be really hard since this is the Chinese government, it would be like Sisyphus pushing a boulder over a mountain to just get a new deal done.

Lol. There's no way MS is selling 1m Xbones in China by next year. Lifetime sales won't even get close to that.

 

[KyanMehwulfe]

Whats the logic behind such a cap?
Why does it exist?

it's not a cap, I'm not sure why the OP chose that word...

it's just the current target or plan... Sony has to assemble and package the consoles in the FTZ area to be able to have them sold through into the mainland. this requires additional investment and maybe other hurdles (lower margins because they have to build or lease new assembly infrastructure). further, they may not unsure of the sales success, and they don't want to invest in the infrastructure, the leased or contracted assembly ventures pose risks or volume concerns, and/or units of a far greater amount only to have them go unsold and perhaps have most of the value trapped there (a lot of the FTZ costs will be sunk and there would likely be significant expenses that may prevent it from being worthwhile to try export unsold units). it could also just be based on retailer demand; they're not going to plan for a much higher volume if they only can rely on a smaller amount to sell through immediatly, too much inventory turnover risk.

anyhow, point is there are a lot of reasons why they would want to start with a conservative plan. but it's not a cap. if the demand and profit margins are there, they would ramp up rather quickly, i'm sure.

 

[On Demand]

We don't know how much Sony is able to sell there total. It could also be 5 million. Lets wait before making concerned conclusions.

 

[Mario007]

That's because the free trade zone opened at 2013 Spet 29, so Chinese gov force them released the console at 2014 Spet 29

Yeah stupid, but that's Chinese gov.

Haha yeah that's precisely my point.

I don't get it. Why even allow consoles to be sold in china if you're gonna limit the number this much?

There's no imposed limit mentioned in the article.

I think people should stay away from these China threads because its clear that neither side knows what the hell they are talking about.

As someone who has done extensive research on this topic I agree.

 

[Kayant]

Sony’s venture for China intends to package 200,000 consoles annually, according to a filing on the website of the China (Shanghai) Pilot Free Trade Zone. Masaki Tsukakoshi, a Tokyo-based spokesman for Sony Computer Entertainment Inc., confirmed the document’s authenticity and said actual production amounts may differ.

Nothing in this quote sounds like a "cap". "Intends", "differ" all point to it being Sony's personal estimates.

Should be interesting how they do there. So launching this year is not on the tables right? I wonder how much of a lead this will give XB1 there before they launch.

 

[Captain Tuttle]

Yea, this is a huge win for Microsoft, How did they negotiate 5 million?

Moneyhats silly. All of the PS4 games will be limited to 900p and an unlocked 30 FPS.

 

[John Bender]

it's not a cap, I'm not sure why the OP chose that word...

Fits perfectly to Orochi's latest threads.

 

[sheamus]

Let just be honest this isn't really about winning a consul war. it's about planting seeds of a new market that will probably be viable in about 5 to 10 years. Not to say China isn't viable currently it's more of we need to build mind share within that nation. Indoctrinate a new generation of consumers

 

[zomgbbqftw]

The figure could be 1 or 10,000,000. What this does is allow PlayStation an official presence in China with PSN and other services. I see it as a soft launch, the figure doesn't matter because grey market stock is always going to be cheaper but now those grey market consoles can connect to local PSN services.

 

[Raist]

OP is rather misleading. The actual article doesn't state at all that Sony is "capped at 200k", so I don't know where the whole "MS is allowed 5M?" comparison comes from.

All the article gives is Sony's current forecast for shipments, which is 200k a year.

 

[Xando]

Where does it say its capped at 200k?
The article reads like Sony doesnt allocate more than 200k for now.

 

[Into]

Nowhere in the article does the word cap or capped appear nor is it even implied.

The narrative of 5m Xbox Ones vs 200k PS4s is obviously what you wanted to create, but its based on nothing other than your obvious wishful thinking.

Yea, this is a huge win for Microsoft

 

[Mario007]

Nothing in this quote sounds like a "cap". "Intends", "differ" all point to it being Sony's personal estimates.

Should be interesting how they do there. So from launching this year is not on the tables right? I wonder how much of a lead this will give XB1 there before they launch.

None because of the grey market.

The figure could be 1 or 10,000,000. What this does is allow PlayStation an official presence in China with PSN and other services. I see it as a soft launch, the figure doesn't matter because grey market stock is always going to be cheaper but now those grey market consoles can connect to local PSN services.

Bingo. Also official advertising is a huge bonus.

Though the grey market is a big question mark. Xbone literally disappeared from the grey market weeks before it officially launched. Having said that xbone never had a big presence there anyway.

 

[Kayant]

None because of the grey market.

Bingo. Also official advertising is a huge bonus.

Though the grey market is a big question mark. Xbone literally disappeared from the grey market weeks before it officially launched. Having said that xbone never had a big presence there anyway.

I was more talking "officially" but is there any reference to how both compare in the grey market and which is leading atm?

 

[Nightengale]

I think people should stay away from these China threads because its clear that neither side knows what the hell they are talking about.

Only a few like Dreamgazer knows their stuff.

 

[Dreamgazer]

*sigh*.

Yet another China thread, yet more corrections to be made.

1. There isn't a cap. Even the article said "Sony’s venture for China intends to package 200,000 consoles annually".

2. So what is this?

Basically, Sony applied to have a 500 Square Meters (1/4 football field size) facility established within the Shanghai Free Trade Zone. The facility will house 20 workers to perform basic QA and packaging work for the China market, and Sony themselves estimate that the facility can put out/process through 200K units per year. They'll put in about 1M RMB (<200K USD) for the facility etc.

Source of this new comes from their recently leaked application for Environmental/Industrial chemical use approval (source: a9vg):

I also have a copy of the FTZ application, but not going to post that here since I don't have original source info.

 

[Nightengale]

A wise Dreamgazer appears!

Tldr; the only words of wisdom in this thread.

 

[darkwing]

Man that is low.
China=X1 land then.

yup, China has more than a billion people right?

 

[DC R1D3R]

dat cap.

why so low?

 

[Nightengale]

*sigh*

Your avatar is how I imagine you in every China thread.

People never learn.

 

[Xando]

Man that is low.
China=X1 land then.

Must be because China and Japan hate each other.

 

[Nightengale]

Must be because China and Japan hate each other.

Man, all the Toyotas, Nissans, Nikons and Japanese branded cosmetics I see in China must've been a lie or something.

There's no way China would've allowed those hateful companies to have that kind of penetration into their country.

 

[Dirtyshubb]

Basically, Sony applied to have a 500 Square Meters (1/4 football field size) facility established within the Shanghai Free Trade Zone. The facility will house 20 workers to perform basic QA and packaging work for the China market, and Sony themselves estimate that the facility can put out/process through 200K units per year. They'll put in about 1M RMB (<200K USD) for the facility etc.

Seems like quite a good investment really, I was wondering how much venturing into China would cost them since they need to have a local operation running.

You figure, if they sell through even half of the years allocation they would make some pretty good profit on it.

 

[Dreamgazer]

Your avatar is how I imagine you in every China thread.

People never learn.

People should be free to discuss things even if they aren't knowledgeable.
It's people that fail reading comprehension + making up claims from nowhere that annoys me.

 

[Mario007]

I was more talking "officially" but is there any reference to how both compare in the grey market and which is leading atm?

Xbone is non-existent at the grey market. It may be due to the fact that it launched so close to the Chibese launch in the rest of Asia but honestly I haven't seen a single xbone or xbobe game in the shops I go to.

*sigh*.

Yet another China thread, yet more corrections to be made.

1. There isn't a cap. Even the article said "Sony’s venture for China intends to package 200,000 consoles annually".

2. So what is this?

Basically, Sony applied to have a 500 Square Meters (1/4 football field size) facility established within the Shanghai Free Trade Zone. The facility will house 20 workers to perform basic QA and packaging work for the China market, and Sony themselves estimate that the facility can put out/process through 200K units per year. They'll put in about 1M RMB (<200K USD) for the facility etc.

Source of this new comes from their recently leaked application for Environmental/Industrial chemical use approval (source: a9vg):

I also have a copy of the FTZ application, but not going to post that here since I don't have original source info.

Finally, someone who knows his stuff

 

[John Bender]

Dreamgazer laying the smack down.

Nice post.

 

[Dreamgazer]

Seems like quite a good investment really, I was wondering how much venturing into China would cost them since they need to have a local operation running.

You figure, if they sell through even half of the years allocation they would make some pretty good profit on it.

Well, they do have a local computer entertainment related division in China.
The remnants of their botched 2003 ps2 launch attempt...

http://www.digitaltrends.com/gaming/sony-takes-ps2-to-china-despite-pirates/

History lesson for another time.

 

[AbandonedTrolley]

MS probably forked over a greater some of capital to get that done. Or made concessions to government demands.

Regardless, this is pretty surprising. 100k shipped already for the XB1 and Sony are
already hampered by a units cap and no launch date :/

Kinect always on mandatory!

 

[Tenki]

Both XB1 and PS4 sales in China are going to be extremely low. I remember those thread about selling tens of millions in the country, just because 1.3 billion people live in there.