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American McGee: "Xbox One will fail in China"

By Rachel Weber

American McGee: "Xbox One will fail in China"

Thu 01 May 2014 8:43am GMT / 4:43am EDT / 1:43am PDT

Spicy Horse head gives five reasons why

Never one to be shy with his opinions, Spicy Horse founder American McGee has penned an opinion piece giving five reasons why the Xbox One will fail in China.

He likened the move to "selling sand at the beach" because, despite the ban, consoles are readily available for Chinese gamers that want them. He also argued that the market is packed with cheaper Android-powered set top boxes, and that, "99 per cent of streaming content is consumed on mobile devices or PCs."

McGee is based in Shanghai, China, so he's a man that knows the market. Another of his major concerns for the console is competition from less legal avenues.

"Piracy. If you've not seen it in China, you've not seen anything. It's massive, awe-inspiring, and will poke giant holes in even the best digital content plans."

"There's no stopping a dinosaur"

He also offered a sociological twist, revealing that families that can afford the American hardware are more concerned with their offspring's studies than their entertainment needs, and those that aren't can't afford the Xbox One.

Censorship of content is also cited as a concern. Let's not forget, China is a country that sees fit to censor the internet with more than 60 regulations. The Global Internet Freedom Consortium notes: "The regime not only blocks website content but also monitors who is using the Internet and what they are using it for" - a major stumbling block for Microsoft when it comes to digital publishing and online features.

"I could make more points..." McGee continued.

"Chinese consumers are addicted to mobile phones, gamers get their kicks online, consoles are dead, etc, etc... but there's no stopping a dinosaur. I'll just leave it at five."

You can read the piece in full here.

Microsoft announced yesterday that it would be launching the Xbox One in China, and said, "the culture of games and entertainment is rapidly growing in China, with nearly half a billion people playing games."

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Payton Liu Production Support Analyst, IBM China

31 62 2.0
Though I wish XBOX ONE can open a bright future for Chinese console gamers (which are few in numbers when comparing to the PC & mobile parts), I just find it hard to get a positive view on all these.

Glad (well, maybe I shouldn't be using this word...) that someone shared my concerns on Microsoft's move in China.

If Microsoft and BesTV think that they can profit from media streaming, think harder:
1) Piracy - people will not buy if they can get it free, and it's very very easy to do so in China. There are just too few people support genuine digital contents here in China;
2) Contents - there are people putting newest foreign TV shows (US, UK, etc.) on to the web with Chinese translations within 3 days of original show aired in original country. Can Microsoft and its partner beat this one?
3) Big market can also mean that it might be impossible to crack down illegal contents. People can put far more pirated contents on line than law enforcement can shut them down. And anti-piracy activity is not what law enforcement focus on in China, I'd like to point out more but it might get me in trouble.
4) There are already more than 10 media streaming content providers in China (i.e. Baidu, Sina, Sohu, Youku, iQIYI, LeTV, etc.), and they are legal and mostly free via PC and mobile app. How Microsoft and its partner can convince people to spend $500 US dollars (or more, it's likely to be more expensive in China. just check the Apple products pricing between China and USA) and additional annual fees plus pay per view while people can watch them for free or with much less fees else where?
5) If a media content is banned by official, it's banned everywhere legally in China, i.e. Big Band Theory series has been banned since early this week in China considering it's service provider Sohu paid CBS for legal right to air them in China. Censorship is heavily handed in China, and there is no classification here.

My question is: can Microsoft and BesTV put through all the red tapes and bring Chinese customers something unique?

Posted:2 years ago


Ron Dippold Software/Firmware Engineer

66 219 3.3
I suspect MS knows the odds are bad, and like XBox in Japan they're doing it just to get their foot in the door and as a pride thing. Maybe you only get the foot in. Maybe you lose the foot. But MS has billions to blow on long chances (just look at Surface) and maybe, just maybe it'll go somewhere. Unlike Sony they can afford to do that.

If they can position it as an ostentatious luxury good they might be able to sell a lot... and it has the luxury part, but it's kind of hard to cart your XB1 around in public so everyone else can see it.

Posted:2 years ago


Jeff Kleist Writer, Marketing, Licensing

684 446 0.7
Microdot is much more looking to be a conduit for American cuntent owners And if you pay off enough government officials, you will be able to ban pretty much anything, including illegal streaming sites, if necessary by whitelisting instead of blacklisting. They've done it before

Edited 1 times. Last edit by Jeff Kleist on 1st May 2014 9:50pm

Posted:2 years ago


Jim Burns Research Asisstant

49 85 1.7
So China is satisfied with piracy and really bad games? Is that it?

Posted:2 years ago

For every good point McGee makes, he just has to add a touch of arrogance. "Consoles are dead"? Considering the Xbox One sales are higher than the 360's at launch, and that's not even taking into account the fact that Sony launched at the same time this go around, I'd say he's the 'dinosaur', bringing back that old fatalist remark despite a lack of any evidence.

Posted:2 years ago


Paul Jace Merchandiser

1,169 1,947 1.7
"Xbox One will fail in China"
If they aren't afraid of launching a third system in Japan(where they know it will absolutely 100% fail again) then McGee's words won't bother them. Sure it could fail in China too but thats not even going to put a dent into their very large cash reserves. Which is also one of the reasons they are launching in Japan again.

Posted:2 years ago


Kevin Clark-Patterson Lecturer in Games Development, Lancaster and Morecambe College

295 28 0.1
If you don't try, you will never know!

I am sure Microsoft have evaluated the region and obviously see it as a potential market, short and long term penetration from Microsoft would be interesting to see however.

Posted:2 years ago


Todd Weidner Founder, Big Daddy Game Studio

499 1,241 2.5
gamers are gamers, and gamers will always flock to to hardware that gives the newest gaming experiences and best bang for the buck. I see no reason why Xbox wont do fine in China.

Posted:2 years ago


Andrew Ihegbu Studying Bsc Commercial Music, University of Westminster

490 219 0.4
In it's defense, if XB1's anything like the 360 was, it will be quite a while before they hack it.

Maybe MS are the right people to do this. They broke multiplayer gaming in the original Xbox generation, and kerbed piracy over a short space of time on the merits of no multiplayer for hacked consoles.

Edited 1 times. Last edit by Andrew Ihegbu on 3rd May 2014 12:41am

Posted:2 years ago


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