TCL Multimedia China Game Console to Compete With Microsoft

TCL Multimedia Technology Holdings Ltd. will make a game console in China after the nation lifted a 14-year ban on the devices, challenging competitors including Microsoft Corp. and ZTE Corp.

TCL Multimedia’s T2 game player features a joystick that’s compatible with mobile games for Google Inc.’s Android system so they can be played on any TV, the Hong Kong-based company said in a statement. The video-game industry in China will generate about $10 billion in 2015 revenue, according to PricewaterhouseCoopers LLP estimates.

Chinese authorities reversed course in January on a nationwide ban on video-game consoles that was implemented in 2000 to protect youths from perceived corrupting influence. Microsoft and the potential China market entry of devices from Sony Corp. or Nintendo Co. will pose a challenge for TCL, said Christopher Tse, a Hong Kong-based analyst at RHB Research Institute.

“It does not have the content base to draw gamers from the Xbox and Playstation crowd,” Tse said of TCL’s device. “Even though it has secured exclusive titles from Gameloft, I think stronger titles are needed to kick start the platform.”

TCL Multimedia shares rose 2.6 percent to close at HK$3.16 in Hong Kong trading today. They have lost 12 percent so far this year, compared with a 3.4 percent drop in the benchmark Hang Seng Index.

Microsoft, ZTE

ZTE, China’s second-biggest maker of phone-network equipment, announced a venture last month with online game developer The9 Ltd. to make a gaming console called the Fun Box.

In preparation for the lifting of China’s console ban, Microsoft and BesTV New Media Co., a subsidiary of Shanghai Media Group, formed a $79 million gaming venture in September. Microsoft didn’t say whether the venture would offer its Xbox console or a new device.

TCL Multimedia is one of three listed subsidiaries of TCL Corp., China’s largest maker of liquid-crystal displays, which was founded in 1981. TCL will make the console hardware, to be sold exclusively through Inc. Gameloft SE will provide games, while China Unicom (Hong Kong) Ltd. will help develop and operate a dual-screen platform.

In addition to its game console, TCL also announced a series of TCL “Game TVs,” with six models featuring panels sized from 40 inches to 65 inches.

— With assistance by Edmond Lococo

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