China Telecom Serves up Nintendo Wii-like Service

Video game consoles like the Wii and the Xbox 360 have yet to be officially launched in China due to a government ban. But that hasn't stopped Chinese companies from offering their own gaming systems using motion-sensing technology now popular in the overseas video game market.

China Telecom, one of the country's major mobile carriers, has been providing a Wii-like gaming service as part of its IPTV (Internet Protocol television) package. Called "Tigan Youxi" or "Somatic Gaming," the console uses motion-sensing controllers much like Nintendo's video gaming system.

China Telecom showed off the console earlier this month at an exhibit show in Beijing, where users could play a Ping Pong game on the system.

The gaming system, however, is being made available as an add-on and not as an individual gaming console, said Xu Fei, a China Telecom spokesman. Currently the company is offering the gaming service in provinces located in southern China, where the company is providing IPTV service.

"It is not meant to compete with other gaming systems. And it's not as complex as those products," Xu said, adding that only a few games were available for the system. Instead, the company is using it to attract consumers to subscribe to its IPTV service, which can cost around 30 yuan (US$4) a month, Xu said. The exact price of the add-on could not be immediately provided.

China has a growing online gaming market, valued at about $4 billion in 2009, according to Beijing-based research firm Analysys International. But the gaming industry has been highly regulated as well, resulting in a ban of major overseas video game consoles. The Chinese government sees them as a potential hazard to the country's youth.

Users in China, however, can still buy the consoles through the country's gray market, where local vendors buy the product from overseas and then bring them to sell in the Chinese market. Vendors have also sold reconfigured systems like Microsoft's Xbox 360 so that they can play bootleg games at a cheaper price.

At the same time, China has also come out with Wii knock-offs in the past. Perhaps the most notorious was the Chintendo Vii, that hit headlines in 2007.

But a few Chinese companies hope to seriously contend in the video game market, both domestically and abroad. China's largest PC maker, Lenovo, is developing its own gaming system through its video game unit, Beijing Eedoo Technology.

The gaming system, known as the eBox, also uses motion-sensing technology in a concept similar to Microsoft's Kinect device for its Xbox 360. Users will not be required to rely on controllers, but instead use their physical motions to play the game.

The company is planning on releasing it early next year, said company spokesman Zhang Zhitong. Coinciding with its launch will be the release of 30 games, made from developers in China and in foreign countries such as the U.S. and France.

Both the eBox and China Telecom's gaming service are trying to tap into a big market that few are trying to break into, said Yu Yi, an analyst with Analysys International. "These online games are popular among younger users. But not as appropriate for older users looking for more family oriented entertainment," he said.

In the case of the eBox system, Eedoo believes the console can reach 120 million urban households. Another Chinese company called 3DiJoy specializes in the development of motion gaming products and is working with wide a range of partners including China Telecom, Lenovo and American companies like Hewlett-Packard. Chinese network equipment supplier Huawei has also been offering a Nintendo-Wii-like gaming system as part of a solution to help companies deliver fiber broadband service to homes.

But the big challenge will be trying to find developers to build the games, Yu said. "There's not many Chinese companies going in this direction for gaming," he said. "So there's not as many developers who can build these kinds of games."

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