Boston, MA 05/28/2014 (wallstreetpr) – Sony Corp (ADR) (NYSE:SNE) and Microsoft Corporation (NASDAQ:MSFT) are going neck-to-neck in seeking expanded market for their game consoles. The two tech companies launched their upgraded consoles almost at the same time late last year and went ahead to make big sales in the U.S. within three weeks.
However, various market reports have shown that Sony is ahead of Microsoft in unit sales. Sony and Microsoft launched their game consoles – Xbox One and PlayStation 4, respectively – to coincide with the Christmas festive seasons.
Sony in China
Sony Corp (ADR) (NYSE:SNE) looks to China to expand its games console sales. The company has announced plans to enter into at least two joint ventures in the coming few months. One of the joint ventures will be focused on software and the other on hardware. The company intends to form the joint ventures with its Chinese partner Shanghai Oriental Pearl Group.
China recently lifted the ban on console sales and the move provides an opportunity for Sony Corp (ADR) (NYSE:SNE) to expand its sales. In any case, the company already considers console sales an important contributor to its revenue and it seeks to do more in the segment as the situation may allow.
China banned sale of consoles in 2000 over what authorities termed as a negative impact on the mental health of the youth that are usually the main consumers of game consoles.
The joint ventures
Sony Corp (ADR) (NYSE:SNE) and its Chinese partner Shanghai Oriental Pearl intend to invest 10 million renminbi or about $1.6 million in one joint venture of which Sony will own 49 percent stake and the partner will control the rest.
The other joint venture will be a 43.8 million renminbi business that will be owned 70 percent by Sony and 30 percent by the Chinese partner.
These developments come just about a month after Microsoft also announced a joint venture to market its Xbox One game console in China starting September.
As much as Sony Corp (ADR) (NYSE:SNE) and Microsoft and excited over the opportunity to open sales in China, they will have to do more to make meaningful gains given that most Chinese have taken their gaming habit to smartphones and other mobile devices.
