The Playstation Vita was released last week in the US and while Sony hasn't released sales numbers for any region other than Japan, it is evident that China's "gray market" dealers are stocking up on Vita systems, games and accessories.
One vendor Kotaku spoke with in Beijing recommended the Vita over the 3DS and suggested that I purchase a 3G bundle unit. The price he was offering for the unit was 2800RMB (US$444)—that's $75 dollars more expensive than what the Japanese bundle costs in Japan!
This gray market mark-up was ridiculous, so I asked the vendor about other options. The lady was kind enough to explain that if I were to purchase the system, it would be cheaper if I made my own bundle. She would even throw in a screen protector on the house.
That aside, walking down GuLou or through the basements of Zhongguancun, one can see gray market vendors stocked full of Vita. The question is, if sales figures are that low, how much of sales accounts for what is being sold on the gray market, and where are they coming from? Chinese gaming website, NetEase, has a great article that is a part of their "Witness" column about the process of the gray market.
The following are select excerpts translated and summarized from NetEase.
Panda's Tale （熊猫）
On Friday, Feb. 5, a young man who goes by the name Panda set out from his hometown of Shenzhen for Hong Kong. Panda was heading to HK to purchase a Vita for himself and two of his friends. Before he set out for the train station, he talked with some of his net friends; some of them asked if he was afraid to go to Hong Kong and that if he went, was he afraid of being cut or stabbed. This was all happening as tensions between the Chinese mainland and Hong Kong were at boiling point over the "locusts issue".
In a sense, calling the mainland Chinese "locusts" made sense. Mainland mothers give birth to their children in HK, which diverts medical attention from residents. Mainland tourists buy up all the "good milk powder", and they purchase all the luxury goods.
This phenomenon also happens in the technology market. Last year on Dec. 23, the Vita was released in Hong Kong, where it immediately sold out. Many of the purchasers were mainlanders, and many of the products wound up on the "gray market". (In Hong Kong and Taiwan the gray market is actually referred to as the wet market). It is difficult to find an official location that has the Vita in stock in Hong Kong—even two weeks after launch.
When Panda arrived in Hong Kong that afternoon (the train ride from Shenzhen to HK takes little under an hour), he couldn't find a Vita at any official retail store. He even went to the Sony flagship store. After a full day of searching, Panda finally noticed a PS Vita value pack in a small electronics store. The original price of the bundle was 2,880HKD ($371), but the store owner wanted 4,800HKD ($618).
Disgusted by that price, Panda continued to set out searching for a Vita. He soon found a SUNING electronics store that had the Vita in stock. After discussing it with his friends, he purchased two Vita value packs worth 3,380HKD ($440). He also bought a copy of Michael Jackson: The Experience HD and a 32GB memory card for his friends.
It took Panda over 7,000 RMB ($1,100), including the transportation and food costs, and over 11 hours to find a PS Vita.
Xiao Hei's Tale (小黑）
In Wuxi, Jiangsu Province (about one thousand miles away from Shenzhen), another young man, Xiao Hei, set out to find a PS Vita. He went to the city's tech market to inquire more about the device.
After an hours time, he found out that PS Vita value packs were no longer in stock and that stores only had single units left. The single wifi-only core unit was reported to cost 2150RMB ($341). Despite the price, Xiao Hei was interested.
Upon closer inspection of the units that were in the store, Xiao Hei noticed that many of the boxes had their seals broken. When he asked the store owner about it, the store owner told him, "Because the systems are 'Wet Products' (another term referring to non legal imports) the people bringing them in need to open up the box, otherwise inspectors would stop them from entering the country."
As Xiao Hei got home, he went online to do a Taobao search (China's version of Ebay but with more stuff) for the PS Vita. He found that one store had sold over 1,500 units of the PS Vita since launch day, that is over 40 units a day. Xiao Hei went to another web store on Taobao and found that the owner was online. This owner happened to have Vita value packs for sale, at the price of 3000RMB ($476). When Xiao Hei asked the owner where he got his systems, the man replied, "I have a cousin who lives in Shenzhen, he travels over to Hong Kong to buy stock for me."
All this to get the PS Vita, which is made in China, back into to the country, so gamers can buy and play it.