Microsoft Plans Deliberate Xbox 360 Shortage 451
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.
Corporate dishonesty (Score:4, Insightful)
Boo Microsoft! (Score:2, Insightful)
This Is A Good Move (Score:5, Insightful)
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.
Oh no! (Score:5, Insightful)
Re:Corporate dishonesty (Score:5, Insightful)
Becomming?
This is Microsoft...its the way they have always been.
so what? (Score:3, Insightful)
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
Re:And the point is.. (Score:3, Insightful)
All of these are a scam (Score:5, Insightful)
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.
Duh!!! (Score:5, Insightful)
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!
It will really suck (Score:3, Insightful)
Yeah, it's a conspiracy... (Score:5, Insightful)
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...
It makes sense. (Score:3, Insightful)
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.
Did anyone RTFA....anyone? (Score:5, Insightful)
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?
Re:Unbelievable (Score:2, Insightful)
No, that would be Ingvar Kamprad.
Re:Why I won't buy an Xbox360.... (Score:5, Insightful)
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.
Re:Corporate dishonesty (Score:1, Insightful)
No? Didn't think so.
Stop ragging on Microsoft, because it's obivious everything you think you know about them you read on Slashdot and you're making yourself look like a fucking retard.
Re:Duh!!! (Score:5, Insightful)
Because they understand that by creating shortage they can dictate the pace and to some extent increase demand for the product.
This is all Mgt 101 people, not some grand plot to take over the world.
Moderator refresher course (Score:2, Insightful)
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.
Re:Boo Microsoft! (Score:4, Insightful)
Also, when the mainstream media begins to run stories on XBOX 360's selling out everywhere, you will get nervous parents attempting to secure one in case their child wants it for christmas. Parents do not raise their kids these days, they appease them. All large companies selling to that target know this, and take advantage of it.
What's to be gained from "selling out" if the actual numbers are low? While MS can say they sold out at launch, they'd just be opening themselves up to a lot of headlines lambasting them. More than usual
This may be true in certain tech media, but probably not in the local news arena. These big conglomerate types do not like to pick fights with each other, as there are very serious long term consequences to such actions. That may also account for a significant number of stories being "squashed" by editors.
I really hate to say it, but gamer bloggers may be the biggest asset when it comes to outing Microsoft on this crap.
Re:All of these are a scam (Score:3, Insightful)
I think there is a reason they are launching in November.
In other News... (Score:1, Insightful)
Re:Did anyone RTFA....anyone? (Score:3, Insightful)
So that whole... christmas sales things... that's not important? Are they literally saying that they're going to stockpile units during christmas, in hopes that more people will buy them after christmas? Isn't that a rediculous suggestion on its face?
Re:Boo Microsoft! (Score:2, Insightful)
I use both Apple and MS products and there are advantages and disadvantages to both. Work computer: Compaq laptop, cheap, dependable, runs 24x7 (with rebooting!), no hardware failures in almost 2 years, it cost $649 after rebates at Best Buy. Home computer: TiPowerbook G4, 4 years old, EVERYONE uses it, I got a deal on it and bought it used for $750.
Who knows, maybe Apple does play the artificial shortage game, but so far my perspective has been that when they run out of something, it is due to either underestimating demand or a production glitch.
-A
Bingo! (Score:5, Insightful)
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"?
Re:Slashdot message applies to Xbox (Score:2, Insightful)
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.
Re:Favorite Quote from Parent's Interview Link (Score:3, Insightful)
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.
Re:They're more environmentally friendly (Score:5, Insightful)
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
merely consumers? (Score:4, Insightful)
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.
Hype, fools, money (Score:3, Insightful)
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.
HATE (Score:5, Insightful)
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
eBay does this as a secondary market (Score:4, Insightful)
Therein lies the challenge for a manufacturer auction, as their motives and marketing practices would be suspect (hence the parent post).
Re:Corporate dishonesty (Score:3, Insightful)
Re:Bingo! (Score:2, Insightful)
Re:Corporate dishonesty (Score:5, Insightful)
WRT oversupply, I believe you're thinking about dumping, which is a situation in which a company will flood the market with product at a price below production cost in order to drive competitors from the market. There are laws and international treaties against this behavior because if the strategy is successful, it leads to a monopolized market, which is bad for everybody except the monopoly supplier.
It is not illegal in most cases to place arbitrary restrictions on supply (exceptions being public services, utilities and such). This is not an anticompetitive practice, as it has no effect on the ability of competitors to set their own supply levels and price points, and in an efficient market the excess demand will either shift to the competition or drive up the price. While you, as a consumer, might not like the higher price, it is really no different (from a market perspective) than if Microsoft had set the "suggested retail price" at the market-driven price point. In other words, Microsoft is free to charge $20,000 per X-Box if they want, and whether they get to that price point by setting it at the outset or by restricting supply is irrelevant.
While you might not like the tactics designed to generate hype over the product, keep in mind that it's not a guaranteed win for them; they are running the risk of pissing off their customers and driving them to wait for a PS3 instead of buying an XBox.
re: "Apple does this all the time" (Score:3, Insightful)
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.
Good Salesmen Do This? Sounds Like a Broker (Score:4, Insightful)
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.
Just standard economics (Score:5, Insightful)
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.
Re:Corporate dishonesty (Score:2, Insightful)
I know defending Microsoft isn't really permitted here, but this is common business practice, particularly in the auto industry. For example, here in Canada, the supply of Smart Cars (http://www.thesmart.ca/ [thesmart.ca]) is kept artificially low in order to keep prices high. IIRC Chrysler did the same with the PT Cruiser when it was introduced, and BMW did the same with the "new" Mini.
Re:HATE (Score:3, Insightful)
RTFA Much? (Score:2, Insightful)
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?
Nothing new. (Score:3, Insightful)