Why is the Chinese market so important to these large companies other than it being a lot of people?



I understand the Chinese market is HUGE but I don’t understand why companies like say blizzard feel as though they NEED China’s market. Does the rest of the worlds investments not make them enough to continue? Same with the NBA? Maybe a dumb question.

In: Economics

China is growing and rapidly became a big consuming of media, movies, games, etc. China is a much bigger market than all of Africa, a much bigger market than India, for this sort of thing. And you can’t be a part of that market in China without China’s permission

In other markets you can set your own terms, in really small markets you can just ignore them. If Ethiopia boycotts your video game than you lose nothing.

China is not just a big market, it’s THE BIGGEST, and if all you care about is the bottom line, then you listen to China.

Your competition is going to try to penetrate the Chinese market, and if they do and you don’t, you’ll very quickly find yourself outspent, out invested, out resourced, etc. Your competition will have access to revenues and profit you don’t and will use that money to hire people you want to hire, attract customers you want to attract, buy advertising you want to buy, etc. and they can afford to bid more than you (since they have more money). Over time, you get smaller and smaller and they get bigger and bigger.

The answer to the question is exactly the one you state in the question. It is a large marker where you can sell lost of product so a large fraction the revenue for some product are from china.

To get som number movies is easy to look at a so for example for [Avengers: Endgame](https://www.boxofficemojo.com/movies/?page=intl&country=CH&id=marvel2019.htm) the total box office was $2.796 billion of that $614 million was in China that is 20% of the total. You can compare that with $858 million in US and Canada.
The distribution is not the same for product or even movies but it show how large the Chinese market is.

So for produce like moves, games, sport where the primary cost is to produce the move, game etc is something you do once and then distribute it to a huge number of a low cost per customer the profit margin is enormous it might be 50% for a move in a cinema and even higher for games.

So if they need the market depend of your usage of need but it can be a enormous part of there income.

There are a lot more nuances to the blizzard issue then what the main uproar will have you believe. Few things to keep in mind; Blizzard is an American company with minor Chinese holdings (~5%). Blizzard set the rules for the tournament in July, aka about two months ago, so the player knew he would be banned and expected to be. Blizzard has a subdivision located in Shanghai, with approximately 500 employees, employees who’s wellbeing may have/ currently be in danger.

Money is a big part of the issue but it’s not everything.