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Microsoft Abandons 90-Day Target

marc^o^

Nintendo's Pro Bono PR Firm
From Next Generation

Microsoft now admits it will not meet its target of up to 3 million Xbox 360 sales within 90-days of the console's launch.
In a report in today's Financial Times, the company shifted its attention to the longer-term target outlined at CES last week. The firm now says it will hit sales of 4 million to 5.5 million by the end of its financial year, in June.

Analysts believe sales of the console had hit around 1.3 million by the end of the Holiday sales period. But as January moves along, retailers have yet to see evidence of shortages easing.

Xbox 360 chief Peter Moore explained, "Nothing's perfect - you've got a complex piece of hardware that includes1,700 different parts. Every now and again the line will slow down because something's happened and there'll be a component that didn't make it that morning."

He added. "That's just the way of the beast, particularly when you are ramping up factories from ground zero all the way up to full capacity."

Microsoft wants to shift focus to the summer, by which time demand should have been met by supply, assuming consumer interest can be maintained. "[Manufacturer] Celestica coming online makes us feel real good about our ability to do 4.5m to 5.5m, and June is important because it's our fiscal year," said Moore.

Speaking for publishers, Brian Farrell, chief executive of THQ was phlegmatic. "We love product launches, but not necessarily for what they do in the first three to six months. Inventories have been fairly tight but I don't think that should have surprised anyone."

Editors who invested in the x360 for launch must be quite disappointed :-/
 

Ghost

Chili Con Carnage!
that sucks, theres still about 50 days left of that period so they must be quite a long way short to be announcing it already.
 

Xrenity

Member
Xbox 360 chief Peter Moore explained, "Nothing's perfect - you've got a complex piece of hardware that includes1,700 different parts. Every now and again the line will slow down because something's happened and there'll be a component that didn't make it that morning."
You could've figured that out BEFORE LAUNCH.
 
Jeez, they're not expecting for supply to meet demand until JUNE?

To further slow the progress down, I wonder how many units they've had to replace so far?
 
I think most people expected this and confirms the worldwide launch was a very bad idea.

Peter Moore for yet another win.
 

gofreak

GAF's Bob Woodward
Reilly said:
Didn't Moore say at CES that they're opening more factories to pump them out?

That's Celestica, mentioned in the article. I think they're going from 2 to 3 factories, if memory serves me.
 

Lo-Volt

Member
This should strike people as a rookie mistake, even though this isn't Redmond's first go-around. If they had to abandon their target before sixty days, then I'm left wondering how this is going to work out when I want an Xbox; is there going to be anything besides the odd Core shipment in March?
 

Lord Error

Insane For Sony
marc^o^ said:
Editors who invested in the x360 for launch must be quite disappointed :-/
Why would they be disappointed?

X360s are now easy to find in Canada at least. Local Futureshop had them in stock two days ago, which was definitely not the case any time between the launch and the christmas holidays. So I guess shipments are coming regularily here.
 

[Nintex]

Member
Microsoft needs to get there shit together fast. They also need some good games out there. MS needs Halo 3 or a killer app now, PD0 and Kameo are not enough. If Revolution launches early 2006 ,Sony wont wait any longer and unleashes the PS3.
 

marc^o^

Nintendo's Pro Bono PR Firm
Marconelly said:
Why would they be disappointed?
Because they made investments according to these estimates, which proved wrong, thus resulting in less sales and uncertain ROI. At least the tie ratio is very good for the x360 so that could make up for it.
elostyle said:
Well at least the Japan launch was solid if not spectacular.
:lol
 

Kolgar

Member
Haste makes waste.

Sony's a tough enough competitor - they can't afford to keep shooting themselves in the foot like this.
 

open_mouth_

insert_foot_
Is the ~6 or so million lead for Xbox 360 over the PS3 in '06 going to be enough to keep up with Sony's monster for the first year or two? I'm not so sure....
 

Borys

Banned
elostyle said:
Well at least the Japan launch was solid if not spectacular.

:lol

Peter Moore gots to face the music now.
He should abandon the anti-Sony and anti-Nintendo spin and concentrate on explaining to people with money to spend why can't they buy a 360 in January.
 
open_mouth_ said:
Is the ~6 or so million lead for Xbox 360 over the PS3 in '06 going to be enough to keep up with Sony's monster for the first year or two? I'm not so sure....

I doubt it will even reach 5M.

Even a Japanese PS3 launch will create enough media hype in NA and EU to make a lot of people wait a few months for it.

The only downside of these lower estimates is that it means Sony may delay PS3.
 

jipe

Member
Mooreberg said:
They should have kept manufacturing original Xboxen incase something like this happened.

Why? They seem to have enough trouble getting rid of them as it is, and I doubt anyone looking for a 360 would settle for an original Xbox instead.
 

Lo-Volt

Member
Borys said:
Peter Moore gots to face the music now.
He should abandon the anti-Sony and anti-Nintendo spin and concentrate on explaining to people with money to spend why can't they buy a 360 in January.

:lol The space-time continuum will collapse before any of those Microsoft people do something like what you suggest.
 

Baron Aloha

A Shining Example
I'm having a hard time envisioning them reaching their 4.5-5.5 million target by June. If the 1.3 million units sold through the end of the holiday season figure is correct they would need to sell an additional 3.2 million units over the next 6 months to meet the low end of their target. That's approximately 533,333 systems a month. Can they even produce that many yet? And if they can produce them... can they sell them? The system looks like its toast in Japan at the moment so it will be up to the US and European markets to carry the system in the short term.

Apr-Jun are typically slow months for HW sales. If they are going to make good on their targets they need to get rolling on production. This next quarter is crucial IMO. The longer it takes for them to fix the production lines the more it will hurt them. The PS3 gets closer and closer each day.

Then again if they mean 4.5 million units shipped to retailers... they will probably make that goal.
 

marc^o^

Nintendo's Pro Bono PR Firm
Back in June, gamesindustry.biz reported this from Peter Moore:
However, he went on to say that Microsoft has a target of 10 million units, explaining that the firm believes that historically, reaching that threshold has given consoles "tremendous momentum" in the marketplace.

"I'm not in any way saying that he who gets to 10 million first wins," he continued, "but that's a target that we in Redmond believe that we can get to very quickly."
Microsoft rush is explained by this thought that they had to sell 10 million units before the competition. However good this strategy may be, success still relies on good execution...
 

Mooreberg

Member
jipe said:
Why? They seem to have enough trouble getting rid of them as it is, and I doubt anyone looking for a 360 would settle for an original Xbox instead.

Having trouble getting rid of them? They never even dropped the price to $99 and most of what is in stores is a $179 pack that includes Forza (which means for most consumers the system has dropped $20 since E3 2002).

And it isn't about people settling for Xbox instead. There's a lot of people who buy consoles later in the generation when the prices go down. The fact that the top selling game in November was an Xbox SKU is enough evidence that there was life left in the system before they became hellbent on pulling the plug a year early.
 
I really don't think there was any doubt they wouldn't make this deadline. It was a completely mucked up launch and they will pay for it later.
 

VanMardigan

has calmed down a bit.
It's a darn shame. I payed $600 on Ebay for it (including shipping), and I'm really glad I picked it up, since there's no chance it'll be back in the US Virgin Islands anytime soon. Still, Call of Duty is awesome, the marketplace is great, and I love downloading hi res trailers and demos of upcoming games. I understand, however, that nobody can or should have to pay that much for it, so MS really dropped the ball. I haven't had any problems finding oponents in COD, though, so I figure tons of people have been able to pick one up. It really is a nice console, so its a shame its not more widely available.

I'm thoroughly impressed playing everything in 1080i, and have I praised COD enough yet? Outstanding game.
 

jipe

Member
Mooreberg said:
Having trouble getting rid of them? They never even dropped the price to $99 and most of what is in stores is a $179 pack that includes Forza (which means for most consumers the system has dropped $20 since E3 2002).

Where I live they have been on sale for as little as $125, including 25% sales tax. I know similar things has also happened elsewhere in Europe. In any case, even if they could sell them, why would they, if it doesn't make them any profit?
 
okay, so M$ is going to make an Xbox 360 with HD-DVD built in, right
this will piss off the early adopters, of course
so they intentionally throttle the supply until March when HD-DVD launches (along with the new 360)
fewer pissed off customers, better for the platform in the long run

yeaaah I got it alll figured out
 

borghe

Loves the Greater Toronto Area
I am calling it here also.. MS is screwing things up big time currently. HD-DVD (likely to be included later), horrible launch allocations and unavailability two months later. Now it is looking like they won't even have 5M units worldwide before sony launches (Which sony will eat up over 1/5th of that in the first week in japan)

if it's any consolation, they are becoming slightly easier to get now, but now I'm not sure if that's a good thing. Wal-Marts in my area are still only getting 3-4 in per shipment (premium) but now they are sitting on the shelves for over two days. And I would go so far as to say the core system is fairly readily available in many stores here. Is this a tinge of apathy I am sensing?
 
Borys said:
:lol

Peter Moore gots to face the music now.
He should abandon the anti-Sony and anti-Nintendo spin and concentrate on explaining to people with money to spend why can't they buy a 360 in January.

QFT. I'm starting to get a bit pissed off. I have the money tospend, and yet MS can't get off their asses and at least TRY to meet demand.

Stores around me can't even fill the preorders that were ordered last year! FYE (freaking FYE) can't even fill their pre-orders because MS short-shanked them on supply.

Sam goody? Nope. they got 4 systems.. FOUR TOTAL. And never got any more, and no signs as to IF OR WHEN they'll get more.

Toys R Us. They have NO CLUE as to when MS will ship them more.

Best Buy.. when I asked the guy as to when they'd be expecting another shipment, he looked like he wanted to swallow the barrell end of a revolver.

MS has a major supply (or lack of supply) problem.

The secod biggest "free money" time is coming up in tax season, and if MS can't get systems in stores they're in serious trouble. There's a point where "hype" just turns into frustration and people will just wait until something else hits.
 
guys, making the 360 is hard
it has a lot of parts and stuff
try making one yourself before you're so quick to judge microsoft

microsoft is the thought leader, they said so themselves
so maybe you should try thinking the 360 is available, hmmm?
if you keep complaining they'll never ship any more
 
JackFrost2012 said:
guys, making the 360 is hard
it has a lot of parts and stuff
try making one yourself before you're so quick to judge microsoft


Perhaps they should have had MORE of a surplus before they decided to try a worldwide launch. Their biggest and most profitable makret , the US, GOT SCREWED BIG TIME.

Lack of preperation on their part if you ask me.
 

Ulairi

Banned
The Xbox 360 has sold fewer units than the Xbox did in the same time period. The GameCube sold more units than Xbox 360 in a smaller time period.
 

borghe

Loves the Greater Toronto Area
Outcast2004 said:
Best Buy.. when I asked the guy as to when they'd be expecting another shipment, he looked like he wanted to swallow the barrell end of a revolver.
this is bullshit (the guy that is). Best Buys in my area HAVE been getting near-weekly shipments since after christmas. they are only like 3-4 premiums usually. the problem with best buy is that, in my area at least, they don't put the systems out, so it pretty much requires calling them every day. but unless you live in an area smaller than milwaukee, WI, your best buys should have already seen two shipments at least so far. and the most recent shipment saw core units available through the next evening.
 
Ulairi said:
The Xbox 360 has sold fewer units than the Xbox did in the same time period. The GameCube sold more units than Xbox 360 in a smaller time period.


...that whole lack of supply thing creeping up again.....


If the systems were there and replenishing at a quick pace, they'd be selling VERY quickly.

They'd ave ZERO problem meeting their goals.

borghe said:
this is bullshit (the guy that is). Best Buys in my area HAVE been getting near-weekly shipments since after christmas. they are only like 3-4 premiums usually. the problem with best buy is that, in my area at least, they don't put the systems out, so it pretty much requires calling them every day. but unless you live in an area smaller than milwaukee, WI, your best buys should have already seen two shipments at least so far. and the most recent shipment saw core units available through the next evening.

The guy seemed pretty legit to me. He has said they have gotten a couple shipments, but when they come in, they don't know. It's completely random, no way to prepare or inform people.

MS doesn't send them notices, it just shows up on their stock reports. They could come with their shipment of new release DVDs or shimets of just random stock items. The random nature of the replenishment is making it hard to answer a customers questions.

This has been the case at the N. Canton and Akron (Cuyahoga Falls) Best Buy stores. Just no clue of what to expect.

The one that stood out to me is that the stre was expecting 60 systems for right before Xmas and evne put up a flyer stating as such... then they got 20.... mostly cores.
 

Excelion

Banned
i like how Sony's supposed to produce PS3 as fast as Sonic runs. MS seems to have the same shipments as PS2 so far (a bit better in fact). Sony did 10 million in one year, with 40% of them in the last 3 months.
 

borghe

Loves the Greater Toronto Area
psycho_snake said:
So who still thinks that Xbox360 is a threat to PS3's dominance? :lol
the disappointing thing is that technically it is a very able competitor.. MS has no one to blame for these stumbles but themselves. They COULD have beaten Sony to the punch with a capable system. They simply chose not to.
 

psycho_snake

I went to WAGs boutique and all I got was a sniff
borghe said:
the disappointing thing is that technically it is a very able competitor.. MS has no one to blame for these stumbles but themselves. They COULD have beaten Sony to the punch with a capable system. They simply chose not to.
I dont think they could have beaten Sony, but they could have certainly taken a lot of their marektshare and be a very serious threat to their dominance. Xbox360 is a superb console. It has a nice shape, a flawless controller, an very decent library of games already and what looked like a bright future, but they have made so many many mistakes already and have handed Sony 1st place next gen. The only way I can see Xbox360 actually being a real threat to PS3 is if Sony make a big mistake and overprice PS3 too highly, but that is an unlikely scenario.
 

marc^o^

Nintendo's Pro Bono PR Firm
borghe said:
the disappointing thing is that technically it is a very able competitor.. MS has no one to blame for these stumbles but themselves. They COULD have beaten Sony to the punch with a capable system. They simply chose not to.
x360 is capable, it's a good overall system and can still be seen as a good compromise. Remember we don't know the price of the PS3 yet. How much will Blue Ray weight in the bill?

Microsoft is just spoiling their first mover advantage. It's still everyone's ball.
 
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