Kotaku had an article on Sega considering arcade game development for China: http://kotaku.com/5701171/sega-sees-a-future-for-arcade-gamingin-china Does China have a decent number of arcades? Is this an arcade resurgence or something new? I did find this video showing a few of them in Hong Kong: http://www.youtube.com/watch?v=2BvGYDcSY5g&feature=player_profilepage
I remember a pretty busy arcade in North East China (Chang Chun to be precise) It was tucked away near an underground market. Probably had about 20 - 30 arcades. This is going back almost ten years... I remember King of Fighters being pretty popular and mindless puzzle games... but it's dance dance revolution that sticks in my head. One dude was always there and he was pretty sharp, to say the least. Yeah, they got em... or had em. Not sure now though as (I guess) consoles are cheaper and more affordable over there. Also spent about 6 months in SE China and don't remember seeing any there - or in Beijing (was there for a couple of months) but we didn't really go looking for them either.
Arcades are all over china and seem to be pretty busy. I saw two in bejing the last time I was there (There is a Taito center to the east of the forbidden city, and one in the top floor of a western mall, can't remember the name). I didn't have the chance to go in and play anything. Kind of wish I did since the Taito center had Ridge Racer 5 in the back from what I could see. I did go into an arcade in shenyang. They had a lot of older stuff and i'd say 40% of it was King of Fighters (not a single version of street fighter in the place). Still had some good matches with one of my wife's old high school friends.
china is a serious threat (they may have won some sbo's) to japan in kof. thus there must be arcades and enough people going to maintain that level of play
The pirate arcade board market is all Chinese. I can't imagine how many arcades there must be. It would be a cheap business to run.
I'm sure there are Sega City / Sega World's all over China by now. I went to one and saved a Token just for fun.
Arcades are everywhere, but admittedly few Sega games - the only exception being the Initial D series are pretty huge in the arcades. Would love to see a proper Virtua Fighter 5 cabinet here in China - perhaps in Shanghai but definitely not out west where I am.