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.
I don't own an Xbox but I am super pleased that they are coming out with the new version because it then means that the regular Xbox games and console will be coming way down in price. That means I'll be able to finally afford a console that plays games pretty darn well... probably under the current $150 going price for a new unit, and games will be relatively cheap either new or used.
:-)
Of course, I have missed out on a couple of years of playing the console but it'll still be fun for me. After all, Halo is brand new to me and I'll get the same enjoyment and playability out of it that you all did a while back.
p.s. I am the guy that buys all the games in the $5 and $10 bin, including the triple packs you can sometimes buy at Marshalls and TJMaxx.
This post brought to you by your friendly neighborhood MBA.
Auctions would reduce problems with insiders who buy multiple copies of the product at retail and sell scarce goods on eBay. It would also avoid mob scenes in which desperate parents storm the doors of stores known to have the much-sought product. Finally, winning bidders would have some assurance that they will be able to get the scarce item.
Two wrongs don't make a right, but three lefts do.
federal price-fixing indictment?
It's the media/customers that are kinda stupid for falling for these schemes...
You can't blame the customer in situations like this. All they are are consumers who want a product. One metric of a good product is how well it initially sells, and all that's happening here is Microsoft falsifying that metric. It's just your every day corprate dishonesty. You could blame the media for not reporting on anything but the sellout, but it wouldn't suprise me if they just didn't bother digging any deeper to find that side of the story.
I'm against picketing, but I don't know how to show it.
It is a basic human instinct to aggresively persue what is in short supply (i.e. want what you can have, a.k.a. : "wow, its sold out, it must be really good")
I am perfecting the fine art of stating the obvious.
This is actually quite a good idea from Microsoft.
Hold on, let me explain, put the pitchfork down.
Most consoles have huge date one allocations and sell out. There is then a huge gap while the manufacturer re-supplies, eventually things settle down to normal sales figures and supply can match demand.
If MS limit the number of sales on day one, they can keep units flowing into stores instead of having a slump. You'll keep people coming back and retailers won't have dry periods when they've sold out and are waiting for more stock.
It's a crazy plan, but it might just work.
-- I like the cut of your thinking, young man. - me.
I dunno if I'd call that a very good metric. After all, how consumers know how good a product they've never used is ? I would have thought *long term* sales figures would be far more indicative of a "good product".
Why is this any different to Apple's launch of the iPod, Sony's launch of the PS2 or Nintendo's launch of the Gameboy Advance? All of these "sold out" on the day of their launches.
I have no love for Microsoft whatsoever but they're just a big corporation marketing a product that they just want to sell lots of.
And if they leech money from the countless sheeple who just *have* to have something before anyone else in their street, then I say good luck to them!
Gentoo Linux - another day, another USE flag.
Typically diabolical Microsoft marketing.
I'm really thinking about switching to anything else. Unfortunately, I've had bad experiences with Apple in the past, and the Linux options remain immature, especially in Japan.
[And what was all that bizarre junk before the preview? CSS problems on top of the moderation-based attacks? (I had 28 moderations in my last report, and many of them were extremely peculiar.) It seems to think that my Firefox has switched to some sort of accessibility mode?]
Freedom = (Meaningful - Coerced) Choice != (Speech | Beer^2), and sad sock puppets' bad mods avail them naught.
sold out the first day (or two) & there weren't any more units for another month (like the PS2)
Except that's not what happened with the PS2. The PS2 had a largish initial supply that sold out in pre-orders, then a steady trickle of consoles about the size (if not larger) than what Microsoft is planning. The K-B Toys in my local mall, for example, had over 60 they sold as pre-orders, and then had about 10 a day from then on. Those additional 10 all sold out within an hour of when UPS arrived every day. There was no period where there were no units for a month.
Unfortunately, the media is already kissing MS ass when it comes to consoles, and they somehow have built up a sizeable rabid fanboy cabal (in four years), so no, there's really no reason to do this, other than to somehow give themselves validation to these two groups (and possibly astroturf some positive spin to the rest of the public).
Really, is anybody chomping at the bit to get one of these *now*?
Of all my friends and co-workers (100+ people, probably 80% gamers, more than half have Xbox) I know *one* person with a pre-order.
That's my bit of anecdotal evidence. To be fair, I don't know many people in the 16-19 year old age range anymore...
I don't know about that - don't people usually mine jewels from the ground? Sounds like a legitimate scarce supply to me.
Sure sounds like it, doesn't it?
Put "DeBeers" in your Google.
They are a thuggish gang of rogues who (brutally) control the vast majority of the world's diamond production. They even were nice enough to introduce the diamond engagement ring concept, and later, the idiotic "2 months salary" rule.
I`m not bashing their move to have multiple competitive prices, that very much makes sense..
What i`m bashing is MS`s constant moves to lock competition out of markets where they`re strong, their use of proprietary APIs and file formats to prevent competition entering markets where they`re dominant.
If your a microsoft customer, your in exactly the same situation apple was.. For whatever products you buy from microsoft (office, windows etc) your are totally dependant on them. There is no other competitor that offers a compatible replacement for windows (contrast that to unix where the api`s are very similar and there is often binary compatibility between different unixes running on similar hardware, freebsd can execute linux binaries for instance)
Not to mention proprietary networking protocols (such as exchange) and file formats (such as office)..
Microsoft customers are locked in, and that lets MS keep prices artificially high, exactly the kind of deal they themselves don`t want to be on the wrong side of.
I will very much welcome the day when you can buy software from multiple vendors and drop in compatible replacements as easily as with hardware.
http://spamdecoy.net - free throwaway anonymous email - avoid spam!
Of course the sales will be slow:
1. Parents won't see a need to buy another X-box for $300-$400, when the current one looks just fine to them.
2. Half of the launch titles are sequels, remakes, or updated sports games. The others look like regular Xbox titles with better graphics.
3. The PS2 will drop to $99 very soon.
Plenty of other companies have done this, including Slashdot's favorite company, Apple.
wrong. Most of Apple's shortages would be because of greater than anticipated demand and supply issues with parts vendors. They don't intentially limit supply because they know it makes them look bad.
For instance, the PMG5 and iMac G5 were mostly backordered for such long times because IBM couldn't crank out the processors fast enough to keep up the production line.
There's a fine line between anticipated sales and actual sales. Companies typically forecast using prior sales data to anticipate how much of something to make. If they overproduce they lose money . When a companies growth and demand for than product is greater than what they are able to forecast, like in Apple's case, they typically incur a shortage if there's a bottleneck anywhere in the production pipeline.
I remember Dell having a very similar problem about 5-6 years ago when RamBus came out and they had supply issues from the RamBus vendors. Luckily, in most other cases the components that make up their machine are so generic they can substitute another chipset/videocard/modem or whatever if they ever have supply issues, and it's unlikely Intel will ever present them with a processor shortage.
(For those who couldn't catch a clue with a mitt, this is sarcasm.) (And yes, I do need to include this disclaimer.)
The Independent: Reverend Spooner Arrested in Friar Tuck Incident - ISIHAC, Historical Headlines
"Except that's not what happened with the PS2. The PS2 had a largish initial supply that sold out in pre-orders, then a steady trickle of consoles about the size (if not larger) than what Microsoft is planning. The K-B Toys in my local mall, for example, had over 60 they sold as pre-orders, and then had about 10 a day from then on. Those additional 10 all sold out within an hour of when UPS arrived every day. There was no period where there were no units for a month."
Actually you're wrong about all of this. Sony received an initial shipment in from overseas where the units were manufactured, that was enough to cover all of their alloted pre-orders (meaning that each store said I will sell xxx pre-orders, and if the store didn't actually sell that amount of pre-orders, then Sony put those units into a seperate pile if you will), and also a certain number of extras to be sold as regular retail (the number each store was given of these extras was dependent on the size of the store, size of the market city, amount of PS1 console and game sales, plus number of committed pre-sales for the PS2). This shipment sold out within 1-4 days depending on the city, meaning that in some parts of the country it didn't sell as fast as others.
What happened afterwards is the interesting part. Sony then distributed all of those "slush" units that they had extra from the alloted, but unsold pre-orders. These went to the bigger markets where demand was high. Next, the stores themselves started to sell the pre-ordered units that had not been picked up yet. Meaning that K-B, ToysRUs, Best Buy etc took all of the pre-orders that were not paid in full (i.e. the customer only put down the minimum deposit required when they pre-ordered instead of paying for it all up front) and that weren't picked up in the first 2-3 days after product launch and either put them on the shelf or re-distributed them to other stores in bigger markets (Best Buy refunded my $50 since I was called out of town unexpectedly and couldn't get to the store within 3 days of the release). This is the real explanation of why you saw some units trickling into your local K-B, regardless of what the teenager working behind the counter told you the reason was.
Lastly, Sony did not receive a single shipment of PS2s for 4-6 weeks after the initial shipment, you can check with Sony on this (there were also tons of newspaper articles about this situation at the time, perhaps you read a local paper instead of a national paper?). This was caused by a lot of things coming together all at the same time. If I remember correctly there were: factory labor strikes, dock strikes, a minor coup in one of the countries, a ship that "went missing" in a storm and they also blamed some of it on exaggerated production capacities of a factory or 2.
A good example of supply and demand taking their toll is the Wizards of the Coast selling of Magic:the Gathering cards. When M:tG first came out only a few thousand sets were made. People went crazy over the game. So the next set was double the first, the third doubled that again.
;-)
:-) Like politicans - when they start saying they are going to lower your taxes what they really are saying is that they are going to increase your taxes. Soft of a bassackwards way of talking to people. Or maybe they just took classes at the Tower of miniTruth school.
Then the complaints began coming in. It seemed that some distributors were hoarding boxes of cards until the price had risen sufficiently to where they could break the box and sell the individual cards. WotC decided, therefore, to break the cycle and mass produce all of one expansion set. They choose Fallen Empires. A small set that was massively over ordered. There were six waves. The first wave of cards sold out completely. The second wave sold almost all the way. But the third, fourth, fifth, and sixth sets could not be sold. This caused many dealers to go out of business which kind of backfired against WotC who had wanted to teach the distributors a lesson. Instead, the distributors had agreements with the dealers and it was the dealers who ate the cost - not the distributors. M:tG never really recovered from this debacle and Hasbro, Inc. finally bought them out. Hasbro now controls how many cards are produce and the time schedule, and even arranges the large conventions.
Who knows - maybe Hasbro will buy Microsoft? Gack! I can see it now - instead of a paperclip we get toys that talk to us! AHHHHHHHH!!!!!!
Anyway, Microsoft is just trying out flipping the directive by the DOJ people. DOJ said they could no longer force people to sign long term contracts that gave M$ an unfair advantage by locking them in. So now they are trying the opposite. That is: to create an artificial state of panic on the part of the people who want to buy an XBox 360. By restricting the flow of widgets - er - XBoxes, they create a void which they are hoping a lot of people will come rushing into thus causing an increase in price. Sort of like how the oil companies in the 1970s faked the oil crisis and caused gas prices to go sky high, long lines, etc.... Or maybe you'd like to talk about Reliant Energy's rolling blackouts in California. Amazing how companies say to our faces "Trust us" and then stab us in the back time and again. Let's see....what are some of those slogans?
Trust us...You can rely on us...We bring good things to something or other...
Do you ever feel that you are a cow who's visiting the slaughterhouse for the second time?
Someone put a black hole in my pocket and now I'm broke.
It is not illegal in most cases to place arbitrary restrictions on supply (exceptions being public services, utilities and such).
Contracts, arrangements or understandings that restrict dealings or affect competition and Bait advertising are illegal in Australia.