Due to "Government restrictions", Google's Android Market has been blocked, again. This is not the first time Google's app store has been rejected, as it happened back in 2009. Android users now only have the chance to use China's local app stores. The move could possibly have been to funnel money into Chinese Government's own app store, rather than Google. China's local app stores offer most of the content for free and Android devices are often not synced with the Android Market, so users usually use them.
Google is facing fierce competition in China as they have their local search engine butting heads with them, Baidu. There are reports floating around that Baidu is also planning an OS of their own, Quishi, which funnily enough is meant to be similar to Android. The Android Market is not the only big thing China blocks right now, the Great Firewall black list also includes Google+, Twitter and Facebook.