Game consoles were once banned in China. Now Chinese developers want a slice of the $49 billion pie
GUANGZHOU, China — For 14 years, gaming consoles from the likes of Sony, Microsoft and Nintendo were banned in China.
The ban was finally lifted in 2014.
While these consoles were available on the so-called “grey market” — places that would sell imported devices for a high price — the prohibition led to the surge in popularity of PC and mobile games.
Chinese developers, like giants Tencent and NetEase, poured their efforts into making hit titles for those platforms during the more than a decade-long ban.
Now things are changing. China’s tech giants, alongside a new breed of gaming developers, are looking to tap the growth of videogame consoles in China and target players overseas who have grown up with those devices.
For the global market, the console is huge — roughly like 30% revenue. But in China, it’s only 1% and so there’s a huge potential opportunity for the console game developer inside China.Daniel Ahmadsenior analyst, Niko Partners
Sony, Microsoft and Nintendo have all launched their next-generation gaming consoles in China.
“For the global market, the console is huge — roughly like 30% revenue. But in China, it’s only 1% and so there’s a huge potential opportunity for the console game developer inside China,” Frank Mingbo Li, the founder of Studio Surgical Scalpels, a Tencent-backed game studio, told CNBC.
Studio Surgical Scalpels is making an outer-space based “first-person shooter” game called “Boundary” for PC and Sony’s PlayStation 4 and PlayStation 5.
China’s games console hardware and software market hit $1.84 billion in 2020 and is expected to reach $2.46 billion in 2025, according to market intelligence firm Niko Partners. But that’s eclipsed by both mobile and PC game revenue. Mobile game revenue alone stood at $29.2 billion in 2020.
Globally, the console market is expected to rake in revenue of $49.2 billion, accounting for 28% of the worldwide games market, according to market research firm Newzoo.
That’s where the opportunity lies.
“Despite consoles being banned between 2000 and 2014, we are seeing high demand for consoles in China, and there is an even larger market for console outside the country,” Daniel Ahmad, senior analyst at Niko Partners, told CNBC.
Li, who is a gaming industry veteran, said “Boundary” was designed from the “very first day” for the global market, underscoring the Chinese developer’s ambitions.
“Boundary” is just one of several high-profile console games coming out of China. Another upcoming game is “Black Myth: Wu Kong” which is being developed by Chinese studio Game Science.
Gaming giants eye console market
The world’s largest gaming company, Tencent, along with rival Chinese firm NetEase, are also eyeing the console market.
NetEase launched a high-profile game on Thursday called “Naraka: Bladepoint” — a 60-person battle royale style game like popular title “Fortnite.” The Hangzhou, China-based company is also developing the game for consoles but hasn’t revealed a release date yet.
In 2019, NetEase opened a gaming outfit in Montreal, Canada, to help with international expansion and another studio in Japan dedicated to console game production last year.
In an interview with CNBC this month, Hu Zhipeng, vice president at NetEase, called the console market “pretty attractive.”
“Our Sakura Studio in Japan and in Montreal are dedicated to developing games on consoles, as one third of overseas market shares is taken by console games,” Hu said.
Tencent’s growth in gaming over the years has been driven a lot by acquisitions of or investments into game studios. That has been focused heavily on mobile but is now shifting to companies making games for PC and console.
“Nearly half of the 51 investments in 2021 are in companies with experience developing PC and console games. Many of these are domestic,” according to a Niko Partners report published in May.
Until 2020, most of Tencent’s domestic investments went into mobile gaming while PC and console investments were done overseas, the report noted.
And Tencent-owned developer TiMi Studio has opened offices in Montreal and Seattle to focus on PC and console games.
“Chinese studios are looking to match their overseas peers in game development by standardizing tools, creating advanced production processes, and investing in large teams to ensure they can create large scale AAA quality titles that provide a competitive edge, meet evolving player demands, and reach a broad audience both in terms of geographies and platforms,” Ahmad from Niko Partners said.
AAA is an unofficial term to denote high-quality and popular games.
Technology
Sam Altman says OpenAI will top $20 billion in annualized revenue this year, hundreds of billions by 2030
OpenAI CEO Sam Altman speaks to media following a Q&A at the OpenAI data center in Abilene, Texas, U.S., Sept. 23, 2025.
Shelby Tauber | Reuters
OpenAI CEO Sam Altman said Thursday that the artificial intelligence startup is on track to generate more than $20 billion in annualized revenue run rate this year, with plans to grow to hundreds of billions in sales by 2030.
The company has inked more than $1.4 trillion of infrastructure deals in recent months to try and build out the data centers it says are needed to meet growing demand. The staggering sum has raised questions from investors and others in the industry about where OpenAI will come up with the money.
“We are trying to build the infrastructure for a future economy powered by AI, and given everything we see on the horizon in our research program, this is the time to invest to be really scaling up our technology,” Altman wrote in a post on X. “Massive infrastructure projects take quite awhile to build, so we have to start now.”
OpenAI was founded as a nonprofit research lab in 2015, but has become one of the fastest-growing commercial entities on the planet following the launch of its chatbot ChatGPT in 2022. The startup is currently valued at $500 billion, though it’s still not profitable.
In September, OpenAI CFO Sarah Friar told CNBC that OpenAI was on track to generate $13 billion in revenue this year.
Friar caught the attention of the Trump administration this week after she saying at at event that OpenAI is looking to create an ecosystem of banks, private equity and a federal “backstop” or “guarantee” that could help the company finance its investments in cutting-edge chips.
She clarified those comments late Wednesday, writing in a post on LinkedIn that OpenAI is not seeking a government backstop for its infrastructure commitments.
“I used the word ‘backstop’ and it muddied the point,” Friar wrote. “As the full clip of my answer shows, I was making the point that American strength in technology will come from building real industrial capacity which requires the private sector and government playing their part.”
Venture capitalist David Sacks, who is serving as President Donald Trump’s AI and crypto czar, said Thursday that there will be “no federal bailout for AI.” He wrote in a post on X that if one frontier model company in the U.S. fails, another will take its place.
Altman said Thursday that OpenAI does “not have or want government guarantees for OpenAI datacenters.” He said taxpayers should not bail out companies that make poor decisions, and that “if we get it wrong, that’s on us.”
“This is the bet we are making, and given our vantage point, we feel good about it,” Altman wrote. “But we of course could be wrong, and the market—not the government—will deal with it if we are.”
WATCH: Trump AI czar David Sacks says ‘no federal bailout for AI’ after OpenAI CFO’s comments
Mark Zuckerberg, chief executive officer of Meta Platforms Inc., during a dinner with tech leaders in the State Dining Room of the White House in Washington, DC, US, on Thursday, Sept. 4, 2025. US President Donald Trump said he would be imposing tariffs on semiconductor imports “very shortly” but spare goods from companies like Apple Inc. that have pledged to boost their US investments. Photographer: Will Oliver/EPA/Bloomberg via Getty Images
Will Oliver | Bloomberg | Getty Images
Meta projected that 10% of its overall sales in 2024, or about $16 billion, came from running online ads for scams and banned goods, according to a Thursday report from Reuters.
Those kinds of ads included promotions for “fraudulent e-commerce and investment schemes, illegal online casinos and the sale of banned medical products,” according to the Reuters report, which was based on internal company documents. Those documents showed the company’s attempts to measure the prevalence of fraudulent advertising on its apps like Facebook and Instagram.
Meta brought in more than $164.5 billion in overall sales for 2024. Last week, the company said that third-quarter sales rose 26% year-over-year to $51.24 billion and that it lifted the low end of its total expenses for the year by $2 billion as part of its massive investments into artificial intelligence.
The Reuters report cited a December 2024 document that showed how Meta each year generates roughly $7 billion in annualized sales from so-called “higher risk” scam ads, which are promotions that are clearly deceptive. Each day, Meta shows users an estimated 15 billion of these higher risk scam ads, the Reuters report said, citing a separate document.
Although some of the documents show that Meta aims to reduce the amount of bogus ads on its platform, the Reuters report also said that other documents suggest the company is concerned that its business projections could be impacted by any abrupt removal of the fraudulent promotions.
A Meta spokesperson said that the company “aggressively” addresses scam and fraud ads on its apps. The projections that 10% of the company’s 2024 ad sales came from bunk ads “was a rough and overly-inclusive estimate rather than a definitive or final figure; in fact, subsequent review revealed that many of these ads weren’t violating at all,” the spokesperson said in a statement.
“Unfortunately, the leaked documents present a selective view that distorts Meta’s approach to fraud and scams by focusing on our efforts to assess the scale of the challenge, not the full range of actions we have taken to address the problem,” the spokesperson said.
WATCH: Wall Street backs AI winners, and Meta’s not one of them this quarter.
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