The Decline of the PS3 Grey Market 274
Kotaku has a great piece up looking at trends over time in the PS3 grey market. Michael Fahey has been tracking the falling prices for Sony's new console, via sales on eBay and other markers. He called around to stores as well, getting a feel for the number of returns and current availability of the console. His conclusions: "As it turns out my gamer instincts and the threat of hordes of angry readers steered me clear of potential disaster. Aside from a couple brief spikes, there is no way I'd have been able to pull off the television, and I know damn well I would have waited for Christmas like so many others did, only to lose even more. The moral of this story? There's no such creature as a sure thing. The majority of eBay prospectors walked away from this experience with that lesson burned into the back of their brains. My suggestion for the future? If you want to gamble, go to Vegas. If you want to invest, try mutual funds. Leave the video game system buying to the gamers. We'll all be happier for it. "
Re:Wii on Ebay (Score:2, Informative)
Re:exaggerated (Score:3, Informative)
Re:The Long Tail of speculation! (Score:4, Informative)
As a someone who was 'marginally' successful at scalping my 2 PS3's, I have to say that given it to do over, I would. I had a good time, and I cannot put a price tag on the 'event' itself. I still walked away with a profit.
and I to do not understand why Sony (and really anyone else) doesn't just sell the items themselves. But I believe it has alot to do with law than anything to do with business.
See, it kinda comes down to the same thing with automobiles, atleast here in the states. Technically speaking you, as a customer, cannot buy directly from the manufacturer, for nearly anything. In order for you to purchase item X, the seller has to pay certain fees within it's respective location, think sales-tax etc... . However, getting into a larger issue is that the states (individually) don't want you to be able to buy directly from the manufacturer, because it would cut out their 'inventory' taxes.
It really comes down to taxing the hell out of the product prior to the sale, as that is REALLY where they make there money. Continuing to take car dealerships as an example, the 'dealer' typically does not actually own the vehicle, oh they bought it from the manufacturer, but they don't have to report the buy until the end of the year. At which time any remaining vehicles (and sometimes this is done quarterly, but we'll continue to use annually) are then taxed an 'inventory' tax, and this is on EVERYTHING, not just the car, but parts as well. Its a ridiculous mess.
Now, thats for tangible items, talking about the concert is a little different.
Ticketmaster (again as example) has contracted with nearly every venue out there, to be the sole promoter of any event, which in addition to just about everything else, grants them the right to sale tickets. There use to be a competitor called Ticketron if I recall correctly that did basically the same thing, but at a much lower price. At any rate, a band's promotions and tour organizations are typically in cohoots with Ticketmaster as well, so it benefits everyone but the band who (as I understand it) get very little of the actual 'ticket cost' after all the fees have been added in.
There is nothing wrong with a band attempting to sale it's own tickets, but then it must also incur all marketing costs, venue rental (assuming one can be found that isn't under ticketmaster's thumb) etc... quite quickly becoming cost prohibitive.
Ticketmaster is a fucking rip-off!
Re:Wii on Ebay (Score:3, Informative)
Aside from the "Prohibited" category, which applies to violations of rules, the other ways in which things can be flagged on craigslist aren't supposed to be "rules violations", per se, as much as subjective judgments of appropriateness by users.
Apparently, from your description, it would make many craiglist users, for one thing, feel better.
Same thing happened with XBox 360 (Score:2, Informative)
Nice analysis. I've pointed out before that eBay prices on the PS3 were in a screaming dive within days of launch, but this uses enough data to really make that clear.
We went through this with the XBox 360, but with more speculators. People were trying to unload those things on eBay for months, finally at prices below retail.
The "secret reserve price" thing on eBay is a big part of the problem. That encourages overpriced items and wastes buyer time on auctions doomed to fail. Sellers like it, because they don't have to compete against each other on reserve price, but it probably reduces the number of successful transactions.
Re:good article (Score:4, Informative)
1. $300 for the PS2 was thought of as a bit expensive. $600 for the PS3 is thought of as completely ridiculous. Sony's not going to be able to make money on the PS3 if no one is buying it.
2. While the PS2 was slightly expensive for a whole load of reasons, about a third of the cost of the PS3 is in one component, the BluRay drive. This is a new technology and like all new technologies, it will drop in cost very rapidly.
It's true that the price drop likely won't come until the next holiday season, but that's because of the way electronics sales work, not because Sony wants to hold off on it. And when it does come, it will likely be quite large.
Rob
That's not quite right. (Score:3, Informative)
For instance, in California, If you are a manufacturer that does not sell to the public you get a tax exempt form that allows you to buy raw material without paying the state of California any tax on it. Without this document you pay the tax.
Another consideration is contract law. Sony has contracts with Best Buy, Circuit Shitty, Target, you name the company, to supply them with items. I suppose that each of those contracts has a clause that prohibits Sony from by-passing them and selling direct to the consumer. I could be wrong, but I wouldn't be surprised to find out that such a clause was standard.
Re:Wii on Ebay (Score:3, Informative)
a) Nothing in the article suggests people don't like their PS3s. In fact, the article suggests the opposite conclusion. From my reading of the article, scalpers are returning them not because they don't like them, but because they're entrepreneurs who are only interested in the PS3 as an investment and that investment didn't pan out. However, as soon as the boxes get back in the stores, they're being snapped up again as soon as they arrive. Even on eBay, people are still buying them, they're just not paying as much over list price. I don't blame people for not wanting to pay thousands of dollars for a PS3, but people seem quite willing to pay the price marked on the box or a little bit more.
b) I looked at the SmartBuyer link from the article and found the average selling point [terapeak.com] for Wii's last week was $301. That's about a 20% markup over retail. SmartBuyer is listing [terapeak.com]an average selling price for PS3s of $788 for the same time period. That's about a $30 percent markup over retail. To be fair, glancing down the numbers it doesn't look like this weeks average will be the same. The Wii is getting more expensive and the PS3 less, but it's a far cry from selling them on eBay for a loss.
The big picture here is that the Wii is in high demand and so is the PS3. Any talk right now of people generally not wanting PS3s or that the whole world wants to switch to Wiis is only coming from folks who let their emotions run wild instead of looking at the facts. Who knows what the future will hold. It's possible there will be Wii in every household by Christmas 2007. But we're not there yet.
TW
Re:Wii on Ebay (Score:3, Informative)
Successful not productive.
By being hardworking and very productive, you just increase the chance of being successful under the right circumstances.
Most of the time, you need an opportunity and be able to milk it.
If you father is CEO of a Fortune 500 company, you have plenty of possibilities and only need average effort to be successful.
"Exceptional people deserve to be rewarded for their talent, intelligence, and efforts, not brought down to the level of people who toil at menial work and still expect easy access to everything they want."
Unfortunatly that's not the case. People are rewarded for their success. A top-manager that made his way working 20 hours a day/7 days a week is rewarded the same than a top-manager with more luck and made his way only working 8 hours a day/5 days a week.
There are 6 billions people on earth. Since you compare your intelligence/talent/... to other human being, at least 1 billions people on earth should be worthy enough to have a WII...