Why isn't Nintendo legally selling in China in the first place? I mean Wiis, why don't they sell Chinese versions?

The reason why piracy is high is because it is easy in China.  Yes price is one part of making it easy, but people also do it because it is every where, laws are not enforced, and just because of the volume it is more profitable for vendors.

Look at music in the US.  Piracy is battled, not just with laws and enforcement, distributors have been making it easier to get the music through legal downloads and subscriptions.  Torrents are not as accessible or publicized as (illegal) Napster once was, and record companies flood them with bad files (which I think is hilarious).  Yes they are still easy for tech-savie people but not for the average joe who can afford to pay $.99 or $14.95/month anyway.  Plus with legal internet radio, you can listen to a genre for free and the distributors make money through advertising revenues.

Videogame companies tapped into this to by signing up with Gametap, XBLA, PSN, and NVC for commonly emulated games in the traditional markets.  In China they have to take income into account when they price games, if they were selling Chinese games for $2-$10 that might work, but they would need to sell a lot more copies to make money.  That would be better than making no money off of software. (Of course than you need to prevent importers from buying the Chinese versions... it goes on and on.)

 well, if you're right,the wii's golden years are yet to come.

shanghai's per capita GDP is like $7000, and piracy doesn't look like it's dying in any sense of the word.  per capita GDP isn't income, but i don't know if your figure is income or GDP.

how much do authentic copies of games cost in russia?  i imagine it can't cost like $40, $50 US... maybe $20?

in china i imagine if games cost in the region of 100-200 RNB ($13-$26) some people would actually buy non-pirated copies.  i'm kinda thinking macau in the 80's, when GDP per capita was around $10,000, and i think NES cartridges were being sold for around 100-200 pataca ($12.5-$25) and cost didn't seem like an issue.

well, sooner or later, they will.

just not on their priority list.  might as well shift those wiis to america when wii owners would pay big bucks for software. 

Two points concerning china:

First:
its good for Nintendo. The reason being that BigN is building brand awareness of its products now and might gain loyal customers because of chinese playing pirated games. I think nintendo survived last gen cause of all the loyal fans they got with NES/SNES.

Now eventually, during the next years (hopefully?) the percentage of pirated games will decrease - higher income might lead people to look for non pirated games. and they will know the brand name of Nintendo as their favorite choice for a system.

Heard the same argument about some music groups/ fashion labels not minding the piracy issue - all about building brand name and brand recognition for later on. Also, the reason why PS1 killed N64 was cause everyone and their mother played pirated games, even in the west. that built the brand awareness and made sony happy and richer.

Second:
any idea on how this issue of pirated games could be calculated into the attach rate? I mean if out of 10 million consoles 2 million are only used for pirated games, any way of estimating the "real legal" attach rate? I know its the same issue for PSP, but still.

Blizzard did it right. You can't pirate subscription fees. Nintendo may not be able to sell many legal copies of Wii software - but the VC software and eventually WiiWare software might make a decent profit. Also any kinds of subscription-based games will work ala World of Warcraft.

I'm a chinese so maybe i can tell the truth:Until the government change their mind(to fight against pirate), no one can gain profit from game industry(except OL games which have another kind of way of payment).

Now in china, you can have an easier access to pirated one than the formal one.

Uh! China's average per capita income is $2200? It's only in big cities. The average one of china is far from that.

Anyhow, China is a potentially huge market. It may become a real one but not in the near future.

Nintendo reciently opened official stores in Malaysia, which is also rife with piracy, when i was out there last year 95% of stores sold pirate films and games, with a few offering legit stuff becasue there was a tiny market for it. The majority of sales were made in the markets tho, which was 100% pirate goods.

Im sure china is worse than malaysia for piracy, but their steps into malaysia show that they must be willing to take the risk, maybe this was a testing ground for a push into china.

By the way, Nintendo supposedly entered China. Only with partially different products.

http://en.wikipedia.org/wiki/Nintendo_iQue

http://en.wikipedia.org/wiki/Nintendo_DS ("sometimes abbreviated NDS or DS, also as iQue DS in China")

all cartridge based though........

Gimme the address of a store that do this.
And I am serious my gf's father is one of the officers who goes to stores daily to stop
this and when I am there it is really hard to find something like you say!

Ok dvd movies you can find easy but gameconsoles?