Slashdot Mirror
Microsoft Plans Deliberate Xbox 360 Shortage
An anonymous reader writes "To ensure an immediate "sellout" of the Xbox 360 on launch day (therefore getting lots of media buzz about their new console), Microsoft will simply restrict the supply down to a trickle. My favorite part of the article: "In addition to limiting the per-store stock of consoles and having the retailers prepare to prominently note the unit's "sold out" status, Microsoft has allegedly asked Norwegian retailers to sign an agreement that they'll sell out of the consoles on the launch date."
Looks like it's not a rumour.
Oh, boy. This sort of dishonesty is becoming more and more rampant in corporate culture. As companies become larger and more powerful, they are less susceptible to the consequences of their actions. Remember Microsoft's use of fake "grassroots" letters to the editor in city papers nationwide? Or how about Sony's more recent debacle where they were caught red-handed installing rootkits on their customers computers? Of course it does not help that the US is headed up by an equally dishonest administration....
But ah well, Sony probably does the same thing. It's the media/customers that are kinda stupid for falling for these schemes...
It's not exactly original or unheard of. Plenty of other companies have done this, including Slashdot's favorite company, Apple.
I know slashdot and the nutjobs will make this out to be some part of evil conspiracy, but it's really just simple economics.
If anybody rails on MS over this, you'd have to scream about every oother company that does this too. But they won't because Microsoft is the devil.
It's not like you could ever not buy into the hype and let the things rot on the shelf by not going out to buy them on day one!
Curb CO2 emissions: Kill yourself today!
Who cares?
:-) like fire hazardous power cables and the like. Being an early adopter just qualifies you for "sheep" status.
It isn't as if Sony and Nintendo don't do the same.
That and I'd wait for a while before buying it anyways. Let them work out the rev.1 bugs
That and who cares? If your friend gets one instead of you it means you can spend more time out of your house. It's all good.
Tom
Someday, I'll have a real sig.
... did you not read the first sentance of the summary? Sellout in one day = Lots of publicity = Lots of sales the day after
I mod down anyone who says "I will be modded down for this", regardless of the rest of their comment
Remember the PSP launch? Remember how there was ridiculous prices on ebay and for presell? Do you remember what happened launch day? The local walmart sold hardly any and had a lot left over. It makes you wonder if these companies systematically engage in PR that gives the appearance of big demand to stimulate buzz.
The Xbox360 is the same way; it looks to me that at launch there are no games worth buying combined with a high price and an admission that later consoles will be better because they'll have an HD-DVD built-in and you get the impression that this will lay a big egg on launch.
Really, is anybody chomping at the bit to get one of these *now*? Maybe in about 6-12 months, but there's nothing compelling about this right now.
You were mistaken. Which is odd, since memory shouldn't be a problem for you
This has been going on for DECADES!!! Does anyone remember the Furby?! No, but due to its "shortages" it was the hottest toy of the year. The same was true of the Tickle-me-Elmo. Pet Rocks. Beenie-Babies. It's well known in marketing that the appearance of scarcity increases demand.
Heck, look outside all the hot clubs. The mere fact there's a line makes people think it's the cool place to be. People are sheep. Get used to it!
If someone says he and his monkey have nothing to hide, they almost certainly do.
for Microsoft if after this kind of rumors, it does not sell out at all. And to do this thing around Christmas is really not a good idea anyway. People are not going to wait till the end of januari before they can buy a Christmas present for their kids. They will buy another console, or they will wait for the next birthday/vacation.
My wife's sketchblog Blob[p]: Gastrono-me
So, the slashdot summary seems to imply that this is simply an evil marketing ploy by Microsoft. Instead, I see it as a way of keeping the new Xbox in a position where consumers don't forget about it.
If the new Xbox sold out the first day (or two) & there weren't any more units for another month (like the PS2), how many consumers are going to forget about it? How much marketing momentum do you lose when everyone has to wait a month before they can hope to get the "next big thing"?
If, on the other hand, it sells out on the first day, but customers are told that there will be another shipment in 3-4 days, they'll be a lot less likely to forget about it. Not only that, but when when they do get one, they will still have the excitement of being an early adopter - and I'm sure that will translate to more accessories being sold.
If I were a Microsoft shareholder, I'd be happy with this rollout...
The money is not going to be made by the console, it'll be made by the games, so rather than go for maximum console sales, put the limitation in place to generate hype and now the console is part of the advertising scheme and ends up being a better value for MS.
And anyway, who cares? If you understand this is a ploy it will not really affect you (unless you really really really wanted a 360 on day one). But, I doubt they would do it without having reason to believe it would boost the console's appeal to some people. People that might not have realized tactics like this are used regularly. And those people need to read some books, like "How to Lie With Statistics," to gain some perspective on advertising in genenral.
1 (short ton / firkin) = 89.1432354 slugs / keg
I spent 3 seconds on the arstechnica article posted and see that Microsoft has two options
1) Ship a boatload at once, then have a period where none are available
2) Stream out the shipments so that a constant, but limited supply are available
They saw from the PS2 launch, that the public reaction to option 1 wasn't very good.
So....they choose option 2.
It's a business choice made when weighing manufacturing constraints vs customer reactions.
Of course Slashdot wants to hype this up as yet another reason why Microsoft is evil, and people are biting.
Tell me, which organization here is the one playing psych games with their customers?
Help me take back Slashdot. When did 'News for Nerds' become 'FUD and Conspiracy Theories for Extremist Nutjobs'?
Gates is the wealthiest man on the planet
No, that would be Ingvar Kamprad.
this is just once again proof on MS's crooked business "strategies"....
How is this "crooked?" They make the device. It's theirs. This is not some natural resource that only they have access to. They don't have to let anybody profit from selling it. There's no burden on retailers for this - those stores make money when people stand in line at their stores to buy things. If they don't want to be part of that process, they sure don't have to. They can sell plenty of competing products from other companies (providing, as they sign contracts with Sony or Nintendo, that they like the rules that those manufacturers expect them to follow - and don't think they're not just as restrictive).
But just like book stores that know they'd be foolish (despite a tightly controlled marketing/release plan from the publishers) not to sell the next Harry Potter book, or movie theaters that only have so many seats and have to wait until midnight to sell tickets for a new release, XBox retailers can either work with the product's manufacturer or not. They can agree to terms, and make the money, or not agree to the terms, and find another way to make money. Crooked? Crooked is telling a game manufacturer that they have to deliver a product according to your demands, and not their own wishes. It's so simple: if you don't like MS or how they deal with a product debut, then don't buy their game product as a form of entertainment. If everyone does that, then MS's wishes don't mean anything. But then, no one gets the cool toy, either. But let's try to keep a little perspective, here. It's a toy. You're getting cranky about a toy debut marketing plan.
Don't disappoint your bird dog. Go to the range.
Someone tell me why a post about the article being a dupe got modded to 5-Informative? It says nothing about the article, dupe or not, nothing about the topic, and yet its still modded up to the maximum. It should be 'offtopic' since it has nothing to do with the content of the article.
/. folks are human? OMGWTF, call the police.
For me this wasn't a dupe since I hadn't read it already, yet the first comment I see is some offtopic crap about a duplicate post. What? You mean the
Note this is also offtopic, but I refuse to hide behind the AC mask, because, well, I just damn well feel like it.
And they said zombies weren't real!
...Microsoft starts rumors of planning to deliberately cause an Xbox 360 shortage, in order to drive up preorders.
There's no conspiracy here. Microsoft expects lower sales, and the PR machine is trying to explain why. Are they trying to spin the lower sales in the best way possible? Absolutely. Are the overzealous microsoft markedroids trying to turn the limited availability into positive thing? Of course. Are they deliberately driving down supply? No. The only news is that analysts and microsoft are restating sales estimates. Microsoft says that it's due to a late start in production (believable, given how late the new dev kits were). That might be the reason, or perhaps it's because the 1st gen content is lacking. However, it would be moronic to purposefully drive down supply in order to create "buzz".
I know I'm required to hate Microsoft, but come on. As long as we're throwing out logic, why stop at "Microsoft Plans Deliberate Shortage" when you can have "J Allard Responsible for Lingbergh Baby Kidnapping"?
Yeah I was going to post something similar. People make it sound like MS has this scheme. They don't need a scheme, the shortage is a foregone conclusion. MS moved up the schedule a LOT in order to get the Xbox360 out this early. That's going to cause a lot of issues. THEN they are going to simultaniously launch in America,Europe, and Japan - three markets at once instead of a multi-tierd launch. Even if they actually made enough in time, the chances of them getting the distribution perfect is about nil.
This thing better be pretty good, because if they hit a massive shortage and the word gets out that it sucks/has crap games/etc, it's going to take a MUCH worse hit than it would have otherwise. To me the Nintendo Revolution already stole their thunder, but we'll see.
I could make it take 500 Watts and just dissipate 300 Watts as heat.
;-)
No, it couldn't. If it takes 200 watts, it must dissipate 200 watts as heat. There's just not that much juice going out over the audio/video cables.
I think you misunderstood what he is saying- The idea is that they try and build the system out of as many interchangeable off-the-shelf components as possible so that they can benefit from competition and economies of scale, and that they try to own the IP/means of production on whatever parts can't be interchangeable so that they aren't beholden to any one supplier.
:)
This is sorta the opposite case of Apple's move to x86- having only one major producer of PowerPC chips made Apple dependent upon IBM's capacity to produce the chips in the quantities they need at a good price. Moving to x86 allows them to not only benefit from the Intel's massive production capabilities, but also the fact that there is competition in the market for chips that can handle the x86 instruction set, which drives down prices, and having the possibility of switching to AMD or another producer keeps their options open should Intel try to mess with them.
It's just good business. Funny how when MS does it, they get bashed... Yo, don't hate the playa, hate the game, dawg
You can't blame the customer in situations like this. All they are are consumers who want a product.
You can't blame the profit-driven corporations, if people want to be sheep/consumers, if they want to be told what they need and what they want, and not act like the free-thinking, self-realized human beings that they have the potential of being, then f*** 'em, let them be treated that way. Round 'em up.
Every hyped gadget release is like this. Why do people buy into the hype? It's better to wait and gauge the reaction, especially after the hysteria has died down and been replaced by more level headed reviews and the number of game titles has increased.
Man, I hate when game companies do this.
:(
Many older consoles (Nintendo, I'm looking at you) use tamper-proof screws for this supposed reason. Of course, any half-serious "hacker" will find a way in, usually because these screws aren't that hard to find bits for, thanks to the Internet. A lot of the original reasoning, which I can sort of understand), was to keep casual users from opening them up and messing with them.
Unfortunately, as our Zelda cartridges age, the built-in batteries (CR2032, for anyone who cares - one of the most common "watch" batteries out there) are mostly all dead. In order to use these games anymore, you have to open them up and replace the battery.
Tamper-proof screws make this VERY difficult.
Put labels all you want, if it's warranty you're worried about. But please, understand that these things do need repair from time to time, especially after they're out of their expected lifetime. ESPECIALLY with moving parts inside (Sony, I'm looking at you!). There's nothing worse than having to wreck the casing just to get in and fix a few loose wires
Endless arguments over trivial contradictions in books written by ignorant savages to explain thunder in the dark.
Therein lies the challenge for a manufacturer auction, as their motives and marketing practices would be suspect (hence the parent post).
RichM
Data Center Knowledge
Well, I have mixed feelings on this story. On one hand, yeah - we all know Slashdot is going to latch on tightly to any news item that puts Microsoft in a negative light, so it's immediately suspect.
On the other hand, the part that bothers me is the accusation that MS is intentionally ordering stores to "sell out" on a pre-agreed date, or trying to ensure that the "sold out" notices are prominently displayed.
There's a difference between announcing a new product and not really having much supply of it for a little while after the announcement, and orchestrating the whole thing into a sales gimmick.
I'm an Apple user/fan myself, and I think all of us are aware of Apple's "standard practice" of announcing new products before production is ramped up enough to really supply the demand. But to the best of my knowledge, Apple never pressured any resellers to sign agreements to guarantee they were "sold out" at preset dates/times, or to handle the fact they sold out in a particular fashion. That goes far above and beyond simple inability or unwillingness to supply initial demand for a new product.
"Never risk a sale today for a sale tomorrow." A salesman will always make a sale today. I wouldn't say a bad salesman is devoiding of speculating. Instead of being a salesman, they are acting as a broker which is riding the supply as a commidity market. As a broker they have different goals than a salesman mostly which servicing the consumer is secondary to making sure you maximize your distribution pool.
In previous cases with Apple, Sony, Nintendo, etc is that they were honestly out of product and production couldn't ramp up immediately. UPS would show up with a delivery of 10 units which where automatically sold. 10 more units would not show up till next week. There were simply no more units to buy no matter how long you stood in front of the electronics store or how many times you clicked refresh on Apple.com. What the article is suggesting is that MS doing is putting an artifical ceiling on supply (otherwise known as rationing). Is it a good thing to put rationing on a non-essential item?
I would perferably see a spike than to have MS trying to artifically monkey around with the market. In one case the worst they are accused is that they misjudged demand (hey it happens). In the other case there is something more meleviant is going on. I think that if they artificially hold back warehouses full of product they are looney. Make a sale today you have cash they can use now to reinvest. What would they possibly reinvest in you ask? Something wacky like increase production? If you bank on a sale tomorrow you might have twice as much cash...or they might go off and buy something else.
I learned supply and demand fromd day1 in both my micro and macro economics classes. Its the basis of how the whole market works and its not dishonesty at all.
The sole reason we have price tags is because we have limited resources.
The economy works by supply and demand and if too much supply hits a market which erases demand then competitors leave and it self corrects. Its Microsoft's job to maximize every penny of profit as possible to establish its price equilibrium. To do that it must limit its supply so it can make more money.
But its an industry wide practice and not dishonest. Suppliers all the time decide how much to produce something and use what consumers are willing to pay for to set the price.
http://saveie6.com/
First, a supply shortage of what? Each store gets more premium consolse - the ones that have more involved production wise, as well as a higher margin - which would argue against a lack of supply.
Also, the whole idea that purchasers have to buy two games with the console (remember when a console had a FREE game?)has no basis in supply-demand. It is simply marketing to an extent that is greedy to the core. I can't see a convincing argument that this is anything other than marketing trying to create a buzz. Watch- "new xbox sells out on first day" will be news story in USA Today.
I am curious to see how they dealt with Wal-Mart. I can't imagine a Wal-Mart accepting only 20 units in each store. Two companies accostum to bullying thier business partners - who wins that one?
Yeah, like this tactic is anything new. Sony does exactly the same thing. With the PSP, they only released so many units, and of those units, a larger number were given to companies which followed sony's advertising guidelines more carefully. This is a common tactic, and shouldn't be seen as only something Microsoft would do.
BeauHD. Worst editor since kdawson.