Moore Refutes 360 Launch Rumours

Via Gamasutra, commentary from Peter Moore in the Seattle-PI about the furiously swirling Xbox 360 shortage rumours. From the article: "Is Microsoft purposefully holding back on shipments, trying to create an artificial appearance of extraordinary demand? Xbox executive Peter Moore says no -- pointing instead to the unprecedented scope of the launch. Microsoft, seeking to solidify its place in the living room and challenge Sony's dominant PlayStation franchise, is breaking from tradition by releasing its new machine in North America, Europe and Japan in rapid succession, over a span of three weeks."

Comments

So they're just incompetent?

[nevergleam]

Peter Moore admits it. The shortage is not a result of a malicious (but effective) marketing strategy by Microsoft. Xbox 360s are in shortage because the company can't get their act enough together to fill their pre-orders.

Re:So they're just incompetent?

[Golias]

You don't understand! It's not that we made way too few! It's that we could have sold way too many more than we made! It's not a supply shortage!!! It's a demand over-run!!! Uh... These aren't the droids your looking for! We can go about our business! Move along! Uh... Hmmm... Damn, how does Steve Jobs guy get that hand-waving thing to work?"

Re:So they're just incompetent?

[captaincucumber]

I hate to be the one to defend Microsoft, but your comment makes no sense.

First of all they aren't Microsoft's preorders - individual stores do pre-orders - and they usually start accepting preorders before they even know how many of a particular item they'll actually get.

Second, Microsoft could only make a finite number of Xbox360's between when they finalized the hardware and the launch date. They finalized the hardware something like 6 months ago. They could have moved the launch date up and had fewer 360's available, they could have moved it back and had even more ready. The truth is that there won't be enough 360's to meet demand all the way through the end of this year, and why would Microsoft wait till the end of the year to do their launch? That would make no sense.

Consoles always launch before they have produced enough to meet initial demand. It makes perfect sense to do so.

Re:So they're just incompetent?

[nevergleam]

But making sense is the last of a person's priorities when they are trying to make first post!

Re:So they're just incompetent?

[Retroneous]

Let us not forget, people, this isn't just a problem with Microsoft - before we get onto the old "Microsoft sucks" bandwagon.

Two weeks ago, you couldn't buy a PSP in the UK, since Sony not only couldn't cover the preorders for the unit, but then couldn't supply enough units to retail in the six weeks following the launch.

But, is this the real reason - they just could not make enough PSPs?

No. It isn't. Why? Because they then announced and released the "Giga Pack", which contains all the original PSP "Value Pack" did, but has a 1Gb memory card included. It also costs about £30 more. Funnily enough, there are more than enough Giga Packs to go round. I can walk into any one of ten stores in my town and get one off the shelf.

Can I get a Value Pack? No. They couldn't meet the demand.

Re:So they're just incompetent?

[Eddy Da KillaBee]

Please mod the parent up.

Too many people are blaming this on Microsoft when it's places like EB Games and Gamestop that are part of the problem. I asked one of my friends who works at the Gamestop where I reserved (and paid for) my Xbox 360 and he said he had well over 100 reservations and that they're expecting about 20 on launch day. I'm not even the first shipment. The same problem is happening with my of my old coworkers who works at another Gamestop.

Seems to me that places that do preorders without putting a cap on how many they should have some of the blame.

Wait...

[BigDork1001]

By doing a world wide launch they are creating a shortage. They knew they were going to do a world wide and should have produced enough units. So yes, they created a shortage.

Re:Wait...

[Jarlsberg]

They had a time frame to consider too. They could have started with the US and with time released the machine in Japan and Europe, and then to the rest of the world - you know, like Sony does, except they start in Japan and then release their stuff in a "timely" fashion to the rest of the world. Instead, they do a simultaneous release on three continents, and while that will necessarily make it hard to deliver enough units, it does at least show commitment to the users. It's a pretty smart move, I think, and doesn't leave a lot of people (like an entire continent) feel left out. You will have those who won't get their unit and be pissed about it, but I think it more than evens out by getting the box out to as many countries as possible.

Re:Wait...

[C0rinthian]

You talk as if there is no limitation on how many consoles they can churn out in a given time frame. It is entirely possible that they have slapped together as many of the damn things as they possibly could since they finalized hardware, and that they could not physically make enough by launch to satisfy 3 continents.

It's not like they can push a button and make 50 million units appear in a warehouse...

Re:Wait...

[patternjuggler]

It's a pretty smart move, I think, and doesn't leave a lot of people (like an entire continent) feel left out.

I wish more companies would take the simultaneous release route for books, movies, and games, and every other product that is typically and annoyingly released one continent/country/whatever at a time. If we truly are going to achieve a globalized economy then companies have to take the attitude of the entire world as one giant market: sell products for the same price everywhere, make them available everywhere (at the same time), and not create artificial barriers to trade like regional encoding, and not coerce the governments or resellers into restricting customers from buying their product from anywhere in the world to be delivered anywhere else.

It introduces a lot more risk to have to supply and advertise to one huge market, and have to deal with remaining 'natural' barriers to trade like differing languages. But truly global companies should be able to handle it if they want to compete in that arena.

Re:Wait...

[KDR_11k]

The PC games market seems to be pretty close to that, big releases are usually mere days apart (that can be explained with shipping delays) and completely localized (except for games where that causes a delay, then you can buy the english version now or the localized one later), as opposed to english voices for all versions (with subtitles) and months of delays as is common in the console games market. Very little regional lockout, prices that are pretty similar in Europe and the US, etc. I just wish more publishers would go with the PC market than the console one...

Re:Wait...

[KDR_11k]

Games are also delayed. Some never get released. The original Katamari, for example, was never released here. There are many others (especially RPG's) which just never reach our shores.

That's not just Australia, it's the same for Europe. No Katamari here. The only thing a search for "Katamari" on Amazon brings up is the soundtrack for the second game that costs an outrageous 36 Euros.

scaled back production

[Ender Ryan]

I don't have time to look for it right now, but wasn't there a story a few weeks ago about Microsoft scaling back production of the 360? And then the following week, the supposed "shortages" started being reported on?

Maybe mine was busted

[jclast]

Maybe the one I played in EB wasn't hooked up correctly, but the 360 didn't look or feel like anything special to me. Playing the demo made me want to play Kameo, but it didn't look any better than a regular XBox game to me.

Re:Maybe mine was busted

[jclast]

I don't know how they hooked it up. I like my XBox a lot, but the demo unit I played isn't going to make me go buy a 360 any time soon. Maybe it's not their fault at all. How much better can graphics really get anyway?

Re:Maybe mine was busted

[Jarlsberg]

Hmm. There was another story a couple of days ago that highlighted this. Here's the url: http://www.gamespot.com/features/6139690/index.htm l. It's pretty interesting, though a bit sluggish to load.

Re:Maybe mine was busted

[radish]

What - Sony are releasing another prerendered clip of an old guy smoking in a few months? Sweeet!

inventory

[Red Flayer]

The question (FTFA): "Is Microsoft purposefully holding back on shipments, trying to create an artificial appearance of extraordinary demand?"

The answer: No.

The other question: "Is Microsoft purposefully holding back on production, trying to create an artificial appearance of extraordinary demand?"

The answer: Maybe.

There's no way MS would hold on to extra inventory, it's too traceable, and also not a good idea financially. Instead, claim production insufficiencies -- you still getting reduced supply at release, without tying up cash in inventory, while having a believable justification.

Re:inventory

[ShibaInu]

I would think the faster MS can produce the 360, the better for them. If you have 4 million 360s out in the wild, that is more potential customers for games, Live subscriptions, etc.

If they are slowing production to create a frenzy, it seems very silly to me. If folks have to spend $400 more on EBay than they would at Wal-Mart, that's $400 potentially less dollars going to MS.

Re:inventory

[Elwood P Dowd]

The other other question: "Did Microsoft decide to do a worldwide launch partially because that would mean that they couldn't possibly meet demand?"

The other other answer: Maybe.

Re:inventory

[jonwil]

Something similar happened with the Sony PSP.

Sony put manufacturing focus onto the slimline PS2 initally and deliberatly underproduced PSPs.

Re:inventory

[Jeff DeMaagd]

I'm not buying into this story, I call BS, particularly the numbers. Three units per store is embarassingly small to be relevant. It would be bad sales for a tiny game store at a mall that could sell dozens per day, horrendous when compared to Best Buy that might be able to sell hundreds per day. I don't understand how the launch games can possibly do well if there isn't anything to play them on.

Re:inventory

[Khuffie]

Frankly I'm not buying the whole shortage BS. Ya, the Xbox 360 will probably sell out on day one (or day two), but not due to any shortages. I was worried that the store I pre-ordered from won't have enough to meet all pre-orders (they have around 50); I called them last night and they said that they have more than enough (meaning they have ones that aren't pre-ordered to sell too). And this is a relatively small store whose focus is not primarily on videogames, so I'm sure places like EB will get more.

Stop the FUD!

[Red Flayer]

FFS, now it's not just /.ers, but also bloggers/columnists who are giving inflated prices for the XBox:

"The Xbox 360 Core System, without a hard drive, will cost $300, while the full-fledged Xbox 360, with hard drive, will cost $400."

Damn it, just stop!

Everyone should know by now that the prices will be $299 and $399, respectively.

Re:Stop the FUD!

[An'Desha Danin]

Stop lowballing the prices, everyone knows they're $299.99 and $399.99.

Xbox360

[Tachikoma]

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Yah Right

[wom]

I'm going to believe the guy that's inside the conspiricy?

'Cause what we need

[Associate]

is another slashdot article about the damned 360.

I think he's telling the truth...

[Fred Or Alive]

Although, as someone in the UK, I think a near simulataneous launch across Europe, Japan and North America is great, I can definatley see it causing a load of problems in the "getting enough machines ready in time" factor, compared to the usual technique of spreading the releases out by months between areas. I really don't think it's any holding back on their part, the reported undersupply seems way to bad to be any planned shortage, I really do believe they may just not have enough consoles ready. of course, as this is Microsoft, so everyone assumes they must doing it all for evil...

Of course, it is Microsoft's fault though for trying something really over ambitious, I think they mave have learning why other manufacturers never tried it before.

Re:Lack of numbers

[cornface]

Maybe that artificial shortage is a way of building hype without the same killer-app that the original XBox had?

Yes, that sounds like a winning plan. Drive them into a frenzy and then purposely fail to sell them anything at all, leaving them sad and disenchanted.

PERFECT!

Re:An Important Lesson About Microsoft And The Xbo

[Delphiki]

Hahaha, you have a superb grip on reality. It sounds like your opinions are completely based in fact. You seem to have excellent reasoning skills. You don't seem at all like a fanboy. I'm sure you are much more successfull than all of the "dimwits" who have gotten crazy rich at Microsoft. Good job.

Stop the Presses!

[MeanderingMind]

This just in! A span of three weeks is now simultaneous!

What would Einstein say...

Re:Stop the Presses!

[Jarlsberg]

"Everything's relative"

I gave up my free XBox-360...

[stvangel]

This summer a couple of my coworkers and I won free XBoxes from my company through a technical awards program. This was a new program so we didn't actually receive them but knew they were coming sometime in the future. After a couple weeks we learned that we could get them then, or wait and get XBox 360s when they were released. Naturally ( two of us already had XBox ) we decided to wait.

A couple of months or so ago we started hearing stories about the expected shortage of 360s and mentioned to management that we weren't finding them for pre-order in anything but bundles of $700+ for the good unit ( is anybody -really- going to want the non-HD/wireless version? The extra features of the enhanced model for the extra $100 seems awfully cheap to me ). We were told to go ahead and pre-order ourselves each a bundled system so we would have them on release. We were all very impressed with our management with this extra step up. My two coworkers each ordered a bundle at the Walmart web site ( one of the only one left that we could find that were still selling them ). I decided to hold off until closer to the launch date to get more information.

A few weeks ago another coworker of mine won. He asked if he could get something else because he really wasn't interested in the 360 and didn't even own a television in the first place. Management said sure, just keep the value close to the 360 bundle. He ended up buying a Nikon D50 which is a very nice Digital SLR camera; much more useful to him than the 360. One of my coworkers decided to give up his 360 and go with the D50 as well. His ordered 360 shows up on Monday and he has to ship it off to a coworker in a different city that missed the pre-order. I found out about this a few days ago. They got their cameras a couple weeks ago and are really happy with them.

I like the looks of the 360 and it's capabilities, but I've been having a hard time working up motivation for it. I'm sure I'll end up buying one but I'm in no great hurry to get one now. Sure the unit itself is great but I'm just not seeing the games that make me want to put up with the launch hassle to get one. Particularily when I have no idea when I'd actually get one. I'd rather not be forced to buy a bundle with a few so-so launch titles but wait until sometime next year when they have games that I actually want and I can just walk in and buy it.

I ordered my camera this afternoon. It's not as good as the Nikon, but it's a much smaller Canon that's much more convenient for travel. Hopefully I'll have it by the holiday next week, but I know it's going to be quicker and easier than it would be for me to get a 360.