Sony, Nintendo, and Microsoft have all contributed to a joint letter addressed to the Office of the United States Trade Representative in response to proposed tariffs against China which would impact the gaming console industry. The three gaming giants shared evidence of the impact the industry has on the U.S. economy while stating that such tariffs, should they be imposed by the government on the mega electronics producer that is China, would result in “enormous impact and undue economic harm” directed towards the “entire video game ecosystem.”
The letter, seen here, is dated for June 17th and is a joint response to the tariffs suggested by the Trump administration which would impact video game consoles. Summarizing the potential effects of the tariffs in three points, the trio said the tariffs would injure consumers and developers as well as others involved in the industry, would put thousands of U.S. jobs at risk, and would “stifle innovation” inside and outside of the industry.
“While we appreciate the Administration’s efforts to protect U.S. intellectual property and preserve U.S. high-tech leadership, the disproportionate harm caused by these tariffs to U.S. consumers and businesses will undermine—not advance—these goals,” the letter said.
These tariffs which have been discussed previously could increase the costs of certain goods by as much as 25%. Consoles would fall under the umbrella of products affected, and after stating that “video games are a core part of the fabric of American entertainment culture” and backing that up with stats, the three companies gave an example of the negative impact the tariffs would have on consumers.
“A price increase of 25% will likely put a new video game console out of reach for many American families who we expect to be in the market for a console this holiday season,” the letter said after stating that two out of every three households in the United States have at least one person there who plays video games. “For those purchases that do go forward despite tariffs, consumers would pay $840 million more than they otherwise would have, according to a recent study prepared for the Consumer Technology Association by the independent economic group, Trade Partnership.”0comments
Numerous other reasonings for why the companies think the tariffs shouldn’t go through were provided. Disproportionate impact on smaller developers, potential impact on retailers like Walmart and GameStop, and the threat of stifling innovation which could affect outside industries were all areas that the letter addressed.
There’s already been talk of Nintendo moving its productions out of China to avoid part of the tariffs’ effects. These tariffs aren’t in effect yet, though whether or not they’ll be implemented and if the consoles will be impacted by them depends on the administration’s discretion.