Earlier this week, Microsoft announced that it will launch Xbox One in China this September. The company believes that this move comes at the right time as "the culture of games and entertainment is rapidly growing in China, with nearly half a billion people playing games."
But Spicy Horse founder American McGee believes that they've got it all wrong and that they will end up burning cash in that market. McGee has been stationed in China since 2005, and he has laid out five compelling reasons behind his assessment.
First of all, he believes that selling Xbox One in China is not that different from "selling sand at the beach." While consoles have been officially banned in China for years now, McGee points out that this ban is not actually effective. In fact, it is normal for Chinese consumers to order Xbox One or PlayStation 4 hardware and games from Chinese online stores and receive them next-day.
In the second place comes piracy. According to American McGee, piracy in China is massive, awe-inspiring, and will poke giant holes in even the best digital content plans.
Then there is censorship. Any console shipped out of the Shanghai FTZ will be unable to play any games other than those approved by the Ministry of Culture. This limits both the quality and quantity of content that'd be available through "official" consoles. On the other hand, Chinese consumers are well aware that "rooted" and smuggled consoles suffer from no such restrictions.
And if that's not enough, McGee noted that most middle class Chinese teenagers and youth are spend all their time studying and doing extra-curricular activities to the extent that they literally have no time to play console games; And those who have time to play are typically those who don't have money.
Finally, McGee noticed that Microsoft is touting video streaming as Xbox One's top selling point in China. Unfortunately, this is hardly possible as consumers are already hooked to local companies that offer better and cheaper Android-based set-top-boxes.
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