Microsoft has reportedly teamed up with a Chinese company for a gaming venture that will take advantage of an expected end to the region's console ban.
Microsoft did not immediately respond to a request for comment, but a Beijing-based spokesperson told Bloomberg that "there is great market potential and partnership opportunities here."
"This is the first step of many to come for Microsoft and BesTV and we look forward to exploring new opportunities for bringing entertainment offerings to China," she continued.
Game consoles were banned in China in 2000, ostensibly to protect the country's youth from violent video game content. Sony's PlayStation and Microsoft's Xbox, however, are available in Hong Kong.
In late January, there were reports that Chinese officials were looking into lifting the prohibition, but the move, which would require approval from all parties involved in the initial crackdown, was never finalised.
However, a free trade zone planned for within Shanghai reportedly includes a loosening of restrictions on consoles, Bloomberg said. The zone is expected to launch on 1 October and might also allow for Facebook and Twitter access within China for the first time since 2009.
Ultimately, E-Home Entertainment will produce games and gaming-related products. According to Geek.com, that includes a version of Microsoft's Xbox for China called the Bestpad, which will focus on game play and media streaming.
Microsoft's next-generation Xbox One was announced in May, and is expected to hit UK shelves with a £429 price tag on 22 November.