- Nintendo has partnered with Tencent Holdings Ltd. to sell the Switch console in China.
- Tencent is the world’s largest public video game company in terms of game revenue.
- China lifted its ban on gaming consoles in 2015, but they still account for less than 3% of the country’s gaming market.
Nintendo 
plans to sell its Switch console in China through a partnership with Tencent , according to a Reuters report. China is the world’s largest video game market, but consumers largely invest in mobile and PC titles over consoles.
China’s southern Guangdong province issued a statement on Thursday saying that it has provisionally approved Tencent’s application to sell the console in the province along with a free, trial version of New Super Mario Bros. U Deluxe. The final decision will be made following a comment period ending April 24.
Nintendo stock jumped more than 16 percent following news of the partnership, but analysts warned investors not to get overly excited.
“China has a complicated regulatory environment and it is worth noting that consoles were only unbanned in 2014 after 14 years,” Daniel Ahmad, an analyst at Niko Partner told GameDaily. “Nintendo is currently going through the approval process and whilst the news today is a positive sign, the company still needs to receive approval from China’s Certification Commission….Nintendo and Tencent will also need to submit each game for approval in China and ensure the games comply with content regulations. This too is a lengthy process and means that it will take some time before Nintendo can build up a large library of official games in China.”
Related Article: Smash, DBFZ, and Arena of Valor Round Out Esports Offerings on Nintendo Switch
The Nintendo Switch console proved commercially-successful, selling 32.3M units globally as of December 2018. Nintendo has already sold N64 and the 3DS XL units in China under iQue branding. While selling the Switch in China creates new opportunities, the company has several hurdles to overcome.
For example, foreign home consoles were banned in China from 2000-2015. Despite a lift of the ban and the availability of consoles on the gray market (neighboring countries such as Japan), Chinese consumers still turn to PC and mobile titles more than any other platform.
Despite China’s new game regulations enacted in 2018, Tencent accounted for nearly 15% of the global video game market and earned $19.7B USD in revenue, according to Newzoo.
