China’s TCL prepares to enter the games console market

29 Jan 2014

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TCL's booth at IFA 2012

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Chinese multinational electronics company TCL Corporation has announced it is developing an Xbox-like games console in a bid to grab a slice of the country’s near-US$14bn video-games market.

TCL – which is best known as a TV manufacturer, ranking just behind names like Samsung, LG, Sony, Panasonic and Sharp – is apparently looking for new revenue streams since the Chinese government’s decision to stop subsidising the household appliances market last year.

According to China Daily, TCL now has China’s lucrative video-games market in its sights, which last year pulled in revenue of US$13.7bn. The PC gaming sector is the chief money-maker in China, but a shift could be on the cards now that the government’s ban on games consoles has been suspended.

The sale of foreign-made video-games consoles has been prohibited in China since the early 2000s but, after much discussion throughout 2013, the State Council announced a suspension of the ban earlier this year.

While this temporary lift now permits big names like Sony, Microsoft and Nintendo to manufacture consoles within Shanghai’s free-trade zone and sell them in China after inspection by cultural departments, the video-game giants are approaching the market with caution. They may be waiting to see what new rules are drafted by the government, but there’s also the issue that these consumers simply cannot afford an Xbox One or PlayStation 4, as Reuters reports that more than 70pc of Chinese gamers earn less than US$634 a month.

Shenzhen-based Huawei Technologies is said to have an Android games console set for release in the Chinese market in the second quarter of this year, priced at a reasonable US$200. If TCL also plans to release a homegrown console at an affordable price, it may well curry favour with both the government and the gamers. We’ll find out later this year when the console is set to be unveiled.

Elaine Burke is managing editor of Siliconrepublic.com

editorial@siliconrepublic.com