In a surprise announcement, Microsoft has disclosed that the release of the popular Xbox One video game console in China will be delayed until the end of the year. There was no reason given for the delay. When the Xbox One finally goes on sale, it is expected to cost 3,699 yuan ($602.37) without the Kinect motion detection system and 4,299 yuan ($700) with the Kinect system.
Microsoft is currently the world’s biggest software company and selling the Xbox One in China gives the company access to nearly 1.4 billion consumers. China is the world’s third-biggest gaming market. Companies that can break into the Chinese market can find it quite lucrative. Between the beginning of 2012 to the end of 2013, the revenues from gaming increased by more than 33 percent, totaling nearly $14 billion last year.
This is just the latest in a long list of troubles for Microsoft in China. The company is facing an investigation regarding suspected anti-trust violations related to it’s Windows operating system and Microsoft Office. China has long has a ban on gaming consoles being sold in the country. The ban was lifted in the early months of this year.
In order to comply with China’s manufacturing regulations, Microsoft entered into an agreement with Chinese internet TV set-top box maker BesTV New Media Co Ltd to form a joint venture to manufacture the devices within the country’s Free Trade Zone in Shanghai. Microsoft is not the only company exploring these types of options. Earlier this year, Sony Corp announced a joint venture with Shanghai Oriental Pearl Group to create PlayStation game consoles in China. Unfortunately, the piracy for which China is well known is rampant in the video game industry and PC and mobile gaming already have an established dominance across the country so any gaming company will have an uphill battle.