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This could be a big win for Japan.

In terms of business, many Japanese studios are struggling. Japanese games and games consoles are still popular in places like Taiwan and Hong Kong, but those markets aren't big enough to support an industry. The addition of the Chinese market could potentially allow Japanese developers to keep making games in their own distinct Asian style without having to worry about missing out on what they perceive to be different tastes of the international mainstream.

Also for Japan as a whole this is nothing but good news. There is still anti-Japanese sentiment in China, and games are an amazing source of soft-diplomacy. Japanese developers can reach right in to the living rooms of Chinese kids and teach them that there's a lot to love in Japan. I see seriously think this power to reach the audience is one of the reasons the consoles were banned in the first place
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