Microsoft and Sony expand Chinese game incubator

HONG KONG 23 November (Reuters) – Sony Group Corp (6758.T), said that it plans to expand a program to incubate and identify Chinese-made games. It is competing with Microsoft Corp. (MSFT.O) in a race to tap China’s gaming market.

The programme will spend more than 1,000,000 yuan ($140,000.80) on each game it enrols. It will fund both small and large teams as well as teams with hundreds of engineers or more, Bao bo, Sony’s director for China game production said.

The Japanese tech company’s plans were revealed during a livestreamed event on Tuesday in Chengdu (southwestern China) to restart China Hero Project, which was halted due to COVID-19.

Bao said that “the scale of the third stage will far exceed those of the previous two.” He added that Sony would publish some games and that it will support enrolled projects through its PlayStation Studios.

Sony announced that it would be publishing Convallaria (and Lost Soul Aside) two of the games that were enrolled in the last two phases.

China Hero Project released its first two games in 2017 and 2019, and supported 17 titles. Of these, seven have been sold.

Bao said in an interview that Wednesday to Reuters that the new batch aims for 10 titles or greater and welcomes all genres of games.

It marks the latest in Sony’s years-long approach to China, which ultimately led it to a lucrative exclusivity deal with the Chinese hit game “Genshin Impact” outside of the China Hero Project. It was not widely known prior to its 2019 launch but it quickly became one of the most lucrative games in the world.

Reuters reported last month that Sony’s success with “Genshin Impact” has driven Microsoft to aggressively woo Chinese game developers with big licensing deals.

Sony has established the China Game Production team in China to help it expand its business. Sony Interactive Entertainment (SIE), the gaming-focused subsidiary that Sony has in Shanghai, now has less than 100 employees. It entered China in 2014.

Tatsuo Eguchi, president of SIE Shanghai，said the success of Genshin Impact convinced Sony’s management that Chinese games are important, adding that Sony is allocating more resources than ever there. He stated that Sony’s partnership is continuing with Genshin Impact developer miHoYO.

Sony sells PlayStation (PS1) consoles in China where Chinese people prefer to play mobile-based games.

It has sold more Chinese PS4 consoles than any other company, and Jim Ryan (CEO of SIE) stated that the company had sold 670,000 PS5 consoles there since May 2021, when it launched in China.

Eguchi stated that Sony aims to sell twice as many PS5 consoles per year as the PS4 and suggested that the China Hero Project could help them achieve this goal.

“We want gamers to be able to see the creativeness that comes from China. “Console gaming has been a part my life since childhood,” he stated.

(This story has been updated to reflect that there are just less than 100 people in paragraph 10

($1 = 7.1388 Chinese yuan renminbi)

Reporting by Josh Ye. Editing and editing by Alexander Smith & Louise Heavens

Our Standards: The Thomson Reuters Trust Principles.