Posted by: kurtsh | November 25, 2005

COMMENTARY: How do I get an XBox360?

There’s been a lot of lame rumors going around recently about what Microsoft’s doing to get more XBox’s out there in distribution.  I myself have gone to eBay for 2 consoles and paid a healthy premium – but I accept that there’s a cost to getting an in-demand item.  That’s supply and demand.
I’m not going to sit here and ‘hate’ on the ‘scalpers’.  They provide a legitimate service and that’s what capitalism’s all about.  I personally waited in line with these folks (I was unable to procure one at the Mojave Desert launch… long story) and for 10 hours, we all stood in line in front of BestBuy waiting to get our hands on a XBox360… hoping that the unit we got was a Premium pack with a Hard Drive.
There are however two things I’d like to clear up about this whole ‘shortage’:
1) BE PATIENT:  It’s a long ways until Christmas.  Microsoft has new shipments of XBox’s going to the major stores EVERY WEEK.  You’ll notice that the price of XBox360 units on eBay have gone down from $1,500 to around $800.  This drop will continue as more and more units are available in the distribution channel every week.  In fact, all you need to do is call your local store in the evenings to see if they’re going to get any the next day (or call them in the morning to see if they’re expecting any midday)… and then just show up.
This is the single easiest way we can ‘trump’ scalping:  Simply make the units available at varying intervals every week so that other people – normal consumers – have a shot at getting the inventory just as any other scalper does.  It makes it so that scalpers aren’t the only one’s holding the goods:  There’s ALWAYS an alternative, and that’s to simply wait a little and constantly check back with your local Best Buy or Circuit City.
2) THERE’S NO HOLD BACK:  The conspiracy theorists abound around this topic however, rest assured that we’re not synthetically holding back consoles to heighten the hype around the launch.  I assure you – there’s no need.  Logic dictates that this is clearly the "hot item" of the holiday season and there’s no need to aggrevate people any more than necessary.  We know that all people want to do is buy our product.   We’re chruning ’em out as fast as we can. 
And if you really want to get down to brass tacks, our goal is to sell GAMES – not consoles.  We need the consoles in people’s hands as a platform to sell games.  We make a rumored $8-$9 per 3rd party game and a bit more for our first party games.  We lose a considerable amount of money on the consoles but without the consoles out there, we can’t sell the games.  We NEED as many consoles out there as possible and as soon as possible to make up the difference otherwise this whole "razors for razorblades" model falls apart.
But let’s face it:  People hate us not matter what we do.  We could have enough consoles for everyone and the press would conclude that the product "is a dud" because people aren’t fist fighting in the aisles for an XBox360.  We could come out with the cure for cancer and there’s be some guy with a Macintosh yelling about how "we could have released it sooner" or that "we’re trying to monopolize the market on cancer cures".


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