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XBox (Games)

3 Million 360s In 3 Months? 52

Posted by Zonk from the that's-a-lot-of-neon-green dept.
Microsoft is apparently hoping to sell 3 million of its next-gen console in its first three months of life, reports ZDNet. From the article: "'We think through the first 90 days of launch...we expect to have sold 2.75 (million) to 3 million consoles worldwide,' said Bryan Lee, chief financial officer of Microsoft's Home and Entertainment unit. Lee's comments came as part of a speech at the Harris Nesbitt Media & Entertainment Conference in New York. Lee said the prediction should translate to about $1.5 billion in sales of Xbox devices, games and accessories during that period."
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3 Million 360s In 3 Months? More

3 Million 360s In 3 Months?

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  • Magical production process (Score:3, Interesting)

    by Datamonstar ( 845886 ) on Wednesday November 09, 2005 @02:26PM (#13990546)
    IANAB(businessman) But...
    If they can magically produce 3 million in three months, then why not go ahead and delay the release a week or two and not have a shortage, since they're so guaranteed to sell so many?

    • Re:Magical production process (Score:1, Informative)

      by Anonymous Coward

      Because the preception of scaricty on the part of a consumer can induce irrational purchasing behaviour.

      See, they don't know shit about whether they're going to sell out of X-boxes. But they know that if they SAY they're going to sell out of X-boxes, then people on the fence will buy it thinking that they'll never see another one for 3 months.

    • Because business analysts pull this stuff out of their asses. That and in any company, marketing, business development, engineering, and manufacturing are locked in an eternal struggle in which there always has to be at least one loser.
    • The shortage thing is still potentially rumor. And this particular piece could be evidence against that rumor, and not necessarily facts that exist alongside it.
      • "Potentially"?

        Remember how every EB was "sold out" of 360 pre-orders a month ago? They all magically have a seemingly unlimited number available now. The star shaped "Sold Out" post-it notes have come off of the boxes (who picked the box colors for this thing anyway? They're ugly) and have been replaced with "Pre-Order Now!" stickers.

        If you pre-ordered more than one in hopes of selling it on eBay for a profit, I'd suggest getting your deposits back now.
        • As I understand it, MS guaranteed certain allocations to retailers that were probably a small proportion of what they hoped to ship but a number that they knew they could hit easily. They did this so that even if production issues arose they could meet those sales numbers. Perhaps they told retailers that we can only ensure that we will have 100,000-250,000 units on launch day. Retailers sold those rather quickly as earlier bidding and deposits were used to reduce the quantity demanded. Now as MS gets c
    • It appears you have not been reading all of the speculation. [gamespot.com]

    • Re:Magical production process (Score:5, Funny)

      by richie2000 ( 159732 ) <rickard.olsson@gmail.com> on Wednesday November 09, 2005 @02:40PM (#13990658) Homepage Journal
      Because they say they will SELL 3 million consoles, they have not said anything about DELIVERING them. Like the poor Windows Defender guy, you assume that you are dealing with an honest vendor of good repute and fail to realize you're talking about Microsoft. They will happily take your money and only if you're really, really lucky, they'll spare the time to bend you over for a quickie.

      In fact, that's the main difference between Microsoft and a pick-pocket; the pick-pocket will bump into you when he steals your wallet, giving you a bit of human touch.

    • We all know why. They are trying to engineer a "shortage" to pump up demand for the product. It's a marketing manoevre.
    • They can call it a shortage if it's not on the shelf when the customer wants to pay for it on the first day. If the extra units are in a warehouse in California, they can have them on the shelf in stores in a couple of days (a week tops), in time for Christmas, and hope to be the must have item of the season that everybody's clammering for because a thousand people couldn't get them. Unfortunately, there are millions of families that can easily burn a grand on Christmas, that might make this strategy a su
    • "If they can magically produce 3 million in three months, then why not go ahead and delay the release a week or two and not have a shortage, since they're so guaranteed to sell so many?"

      M$ has been building up a supply of 360s for several months for the launch, and I'm not covinced there will be a shortage. A $299 console with only 10 mediocre games avaliable for it isn't going to appeal to that many people no matter how much hype there is behind it. The $399 version seems even sillier... just $100 for a
      • Since you'll be spending $40 anyways for a memory card for the base version (if you want to save your games, ever, which I assume you will), you might want the $100 20GB memory card instead of the $40 64MB memory card.
  • FTA: "According to enthusiast site ActiveWin, Microsoft plans to launch the console in the California desert during an event billed as "Burning Man meets E3"--references to a popular Nevada desert arts festival and the computer game industry's annual trade show."

    Say what? Admittedly, Burning Man has gotten a little commercial in the past couple years, but how is a MS product release anything like Burning Man, other than possibly being in the desert? And how can it be compared to E3, where multiple supp
    • "but how is a MS product release anything like Burning Man, other than possibly being in the desert?"

      Simple. As long as you take a lot of drugs you'll have a good time at either event.

  • $1.5 billion? Wishful thinking... (Score:4, Insightful)

    by ivan256 ( 17499 ) * on Wednesday November 09, 2005 @02:40PM (#13990660)
    So let's say that they sell their 2.75 million Xboxes. For that to be $1.5billion in revenue, they all have to be the $399 version and also have to sell $146 in games and accessories per buyer. Alternatively, the people buying the $299 version have to spend $246 on extras and games on average. They're really counting on an unnaturally high attach rate to get these numbers. Either they're doing something shady to guarantee the numbers come out like that (like counting units shipped to retailers as "sold"), or they're not going to hit $1.5billion on that few consoles.
    • Attachment rate of 3 isn't hard to figure. Most packages have a selection of four games or so. Attach rate for Xbox was higher than for any other console.

      Then again, MS vastly overstated expectations for sales of the first console.

      • You aren't forced to buy a package though...

        This is also the first console that has online multi-player on release day in any meaningful way, so I suspect that accessory controller sales are going to be less common than usual too. Additional players will probably have gotten their controller "free" with their Xbox.
      • Also, the attach rate for Xbox (which had the highes in the history of system launches) was only 2.4.

        The weak launch title lineup seems to indicate (to me at least) that it will be *lower* this time, not higher. Unless, like I said, they play with the numbers by re-definine what counts as a sale.
        • Wasn't that attach rate due to most Xboxes available (Amazon, Gamestop, EB, Best Buy) during/after launch being bundles with 2 games? Thats what I remember seeing at the time.
    • Hmmm...$50-$60 a game + $25-$40 for an extra controller + $25-$35 for memory card if you don't get the HDD = $100 - $135. Of course you can multiply that game number by two or three at least since it is coming out in time for X-Mas (oh dear me, I can see the bad X related promos now) so many people will be getting games at launch and for the holidays. Seriously, if you plan on playing this thing pretty hard you are going to want more then one game at launch anyway.

      I think you underestimate what people a
      • You won't be getting a memory card if you got the hard drive.

        Also, expect extra controller sales to be lower this time around, since this is the first console to ever ship with online multi-player in a meaningful fashion. Instead of a friend pulling up an extra controller, they're going to be playing you online with the controller that came with their Xbox.

        The first Xbox had an attach rate of 2.4 games/accessories per unit, and it was the highest ever. There is no reason to expect that they're going to magi
        • Also, expect extra controller sales to be lower this time around, since this is the first console to ever ship with online multi-player in a meaningful fashion. Instead of a friend pulling up an extra controller, they're going to be playing you online with the controller that came with their Xbox.

          Live is a niche service, don't expect it to play a major role in the branding or sale of the 360. It only reached 10% of the consumer base. Most people actually prefer toplay ofline, this is true for everythign fro
    • Are they including any term of free XBox Live with the $399 version? That could be another cost.. .. Will there be advertising on XBox Live?
    • It looks more realistic if you are factoring in the higher prices in other countries. Including tax, British gamers are being asked to pay $366.14 for the cheap and $488.12 for the expensive version and games are $87.15 each (at today's exchange rates).
      • That does make sense... How much of that is tax though? Because the taxes don't count as Microsoft revenue.
        • Here, 17.5% is tax. The article can't be talking about revenue, since even the most optimistic estimates assume Microsoft is making next to no profit on the first few million consoles, it's far more likely to be turnover that is being discussed.
          • Revenue is roughly the same as receipts, that is, how much money came in through the door. Profit what is left after you subtract how much money went out through the door. So Microsoft certainly may not be profiting on Xbox sales, but they sure are counting on revenue!
            • Maybe that's an american usage? To me in England, revenue = profit, and what you are describing is called turnover.

              In order to get the highest number possible for PR purposes, Microsoft will probably be getting their figures from the prices shops will be selling at, not the prices they are selling the machines to shops at, and they may well be including units that shops have ordered on a non-cancellable basis by shops (but have not yet been delivered) in their count of how many have been 'sold' too.
  • Seems like the MS Game division's PR/Marketing department is spinning in every direction possible.

    First: Limit amount of inventory to create the illusion of demand.
    Second: Pull numbers from MS brand booty to create illusion of demand.
    Third:???
    Fourth: Profit.

    Did I miss anything?
  • Obviously they're trying to drum up sales by saying that everyone will have one, so you must too.

    To be honest, I was very cynical until I saw the first batch of games. They are impressive; and gameplay-wise, not just graphically. If these lot are all single processor efforts, then give it a year or so, there will be some very impressive work appearing.

    I won't be buying one (The only console I've ever bought are the Atari Lynx and GBA), but I don't think that those who do fork out for one will be disappointe
    • To be honest, I was very cynical until I saw the first batch of games. They are impressive; and gameplay-wise, not just graphically.

      Which ones? The Xbox 360 games I've tried/seen have all been extremely blah, very unimpressive. I'm particularly dissapointed in Kameo, which had been rumored to be something special, but in fact seems to be kinda lame (with slightly prettier graphics than the last gen).

      As far as I can tell, the 360 looks slated to continue the recent tradition of launching with a bunch of ve
  • they only sell 2,749,999 consoles ?

    wil it be considered a failure ?

  • Comment removed (Score:5, Funny)

    by account_deleted ( 4530225 ) on Wednesday November 09, 2005 @03:00PM (#13990840)
    Comment removed based on user account deletion
  • I think they'll make the units sold projection, but miss on the sales projection. There's nothing out there that's competing with the Xbox 360, so they shouldn't have too much of a problem moving all those units. However, unless my math is fuzzy, Microsoft would have to sell around 4 software titles for each 360 sold, and that's counting every Xbox as the $399 version. That normally wouldn't be a problem, but the software side has seen a lot of delays by some big name launch titles, like the new Elder Scrol

  • What a shame... (Score:3, Funny)

    by St. Arbirix ( 218306 ) <matthew...townsend@@@gmail...com> on Wednesday November 09, 2005 @03:37PM (#13991187) Homepage Journal
    If that many people bought $500 worth of Mac instead... imagine the net gain in world peace? /zealot
  • With X-mas coming up and no competing release, I suspect that they can easily move 2 million xboxes by end of the year and 3 million in 90 days. The shortage thing is just marketing BS. The only reason the number would not be made is if the box flops out of the door, which does not look like will happen

    With 3 million units. 1.5B is not unreasonable as it is 500$ / console. thousands will be sold in the 1000$ + bundles. As there is no point in buying it without a game. $350 is the minimum that can be s
  • So they're not going to have enough at launch, but they're planning on on selling 3 mil in 3 months? Screw the Irish Potato famine... this is an console famine... or something. Are they expecting terrorists to raid their stockpiles in the warehouses and take all the precious Xboxes?

    Seriously... This is why supply + demand sucks.

    I'm glad I'm not holding my breath for this system. They're seriously monkeying with gamer's wallets this time around. I'm glad I'm not getting my hands dirty with this system.

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