Wednesday, February 13, 2008

Console Post of the Week (Hmm)

Thanks to Skip Key for sending me Major Nelson's preview of his new podcast:
In my first interview with new Xbox boss Don Mattrick, we discuss why he came to Microsoft, the first game he wrote, the current Xbox 360 shortages and more.

Hmm. Major Nelson teed up inventory shortages as a topic.

So Microsoft felt the need to address this.

I downloaded the podcast, and here's the exchange:
Major Nelson: ...I've gotten a few e-mails from folks and they're having trouble finding Xbox's. What's going on there? I figured I've got the boss here, so I'm going to put you in the hot seat.

Mattrick: Well, look, we'd hoped to have a strong showing in North America this holiday season, and we had a stronger showing than anticipated. So we had some shortages--we weren't able to deliver enough hardware against the demand that was in the market. That's a great problem to have. We're addressing that in the coming year. It's going to take a little time for us to amp up our manufacturing, but we're really encouraged that people purchased as many games and as many boxes as they did on our platform, and we think that bodes well for the future.

Based on that statement, I am now 99% convinced that Microsoft is either preparing new units or having serious reliability problems (still).

Here's why. For one, Mattrick is making it sound like the shortages were during the holiday season, but to the best of my knowledge, they weren't. I could have walked in to plenty of places and bought a 360 at any point in December.

The shortages are happening a month and a half after the holiday season.

Plus, his statement that they had "a stronger showing than they anticipated" doesn't wash. Did they not expect console sales in September to double from 2006 with the introduction of Halo 3 and a lower price?

Interestingly, in November-December of 2006, unit sales of the 360 were 1,641,000 in the U.S. (NPD figures). In November-December of 2007, unit sales were 2,030,000. That's a 23.7% increase. Their manufacturing plan didn't anticipate an increase of sales of roughly 25% after a price cut and with the strongest lineup of software in gaming history?

No way. That doesn't pass the smell test, no matter which nose you're using.

Also not passing the smell test is this statement: we're addressing that in the coming year. It's going to take a little time for us to amp up our manufacturing...

Again, no way. Using "the coming year" as a timeframe is a huge red flag. That was planted solely to buy them some time.

Something's going on, and it's big.

Site Meter