X360 Shortage: Chip Supplies the Culprit?

[Zanzibar]

This brief article (http://www.next-gen.biz/index.php?option=com_content&task=view&id=1827&Itemid=2) from Next Generation (next-gen.biz) talks about an interview Microsoft CEO Steve Ballmer gave, in which he talks about chip yields:

Repeating the company's official line on the shortage crisis, which is now threatening to entirely undo Microsoft's attempts to win the next generation war, Ballmer said, "We are making more. All stores are getting new units each week. Can we make as many as people want? The answer is no, but not because we don't want to."
Up for discussion - is the current shortage REALLY 'threatening to entirely undo Microsoft's attempts to win the next generation war'?

[fitbabits]

Up for discussion - is the current shortage REALLY 'threatening to entirely undo Microsoft's attempts to win the next generation war'?
No, not at all. That was likely written by an over-zealous reporter out to cause a stink. Microsoft FTW! :)

[OUX]

Yeah because historical console launches go off without a hitch and everyone is left emotionally filled and content. :rolleyes:

[Heretic Machine]

Up for discussion - is the current shortage REALLY 'threatening to entirely undo Microsoft's attempts to win the next generation war'?

As much as the PS2 launch shortage "threatend to entirely undo Sony's attempts to win the next generation war."

[RMan]

Yea, the only way it significantly hurts them is if the shortage still exists when one of the other next-gen consoles is released, and I'm quite sure there will be no shortage of systems/chips then.

[ween]

All stores are getting new units each week.


i can personally tell you this is bs. the eb i work part time at has yet to receive 1 since launch. if these don't start coming in by mid january, i believe this will hurt MS because people at our store are beginning to get a little annoyed.

[Murtaug]

No, it will not.

I can not quote numbers, so maybe it was not as bad; but Sony was in the same boat last round, and they were/are in the lead last generation.

I think the only thing that will cost Microsoft the win this time around is being first out of the gate. Sure, it did not seem to harm Sony, but look at the Playstation 2. It really is an inferieor piece of hardware compared to the Xbox. I own both, and enjoy both, so don't bother calling me a fanboy.

Microsoft needs to bring the apps to the table. Live last round was wonderful, and it sounds like it is even better this time around. Sony is already throwing any sort of online service out the window it seems. Sony needs to come out of the gate with a machine that does more then play Blu-ray discs, and they probably will not. If anything it will just be a system capable of graphics on par with the 360. Microsoft has the head start, but they've given Sony the chance to see their hand before making their full bet, and that will probably be the one thing that hurts Microsoft at this point.

I rather doubt it will make much of a difference though. Sony probably has the PS3 all but wrapped up in their eyes. Nintendo is apparently not even going to be a player this time around, taking to the wings, perhaps to try and regroup for a bigger push next-next gen?

Shortages might hurt their holiday sales, but it is not the end of Microsoft, nor the 360.

[51|RandoM]

Until they can buy a ps3 instead, the shortage isn't a problem for anybody besides early-adopter console addicts.

[fitbabits]

All stores are getting new units each week.


i can personally tell you this is bs. the eb i work part time at has yet to receive 1 since launch. if these don't start coming in by mid january, i believe this will hurt MS because people at our store are beginning to get a little annoyed.
They'll get annoyed and go elsewhere to get it. They won't not buy it if it's something they really want. Think about it - if you really wanted, say, a slimline PS2 and the store you shop at most often didn't have it, would you give up there and then or go look for it elsewhere?

[Cubfan]

All stores are getting new units each week.


i can personally tell you this is bs. the eb i work part time at has yet to receive 1 since launch. if these don't start coming in by mid january, i believe this will hurt MS because people at our store are beginning to get a little annoyed.

My girlfriend bought one for me from the local target on Monday, they had just gotten a shipment.

[bapenguin]

All stores are getting new units each week.


i can personally tell you this is bs. the eb i work part time at has yet to receive 1 since launch. if these don't start coming in by mid january, i believe this will hurt MS because people at our store are beginning to get a little annoyed.

Wrong...stores aren't getting shipments...distribution centers for individual companies are getting shipments.

[Zanzibar]

All stores are getting new units each week.


i can personally tell you this is bs. the eb i work part time at has yet to receive 1 since launch. if these don't start coming in by mid january, i believe this will hurt MS because people at our store are beginning to get a little annoyed.

He's probably not being specific enough. They're shipping them weekly; whether EB/Target/Best Buy etc. is stockpiling them before distribution to the individual stores is up to the companies themselves.

[phantomhitman]

Wrong...stores aren't getting shipments...distribution centers for individual companies are getting shipments.

ding ding ding
The "upper class" dicks are not sending them out from there until they get a certain amount (this is not only from best buy, but all retial stores as well as game stores). I do understand why but that is an ass move to pull, they shold just send them out as they get them instead of hand picking what stores they go to or trying to build up and surplas of x amount of systems before they ship ESPECIALLY to the people that preordered so long ago.

[Nuggsy]

Is it me or does it just seem like he's passing the buck on this one? I was in an EB the other day and some teenage kid was harassing the clerk about the fact that they hadn't gotten any shipments in since the initial one. Me and several of the other customers kind of ganged up on the kid and just told him to leave the clerk alone, that it wasn't his fault, etc. Needless to say the kid left in a huff.

I can't stand people like that. Personally I think that if Microsoft had waited until after Christmas, then the shortage wouldn't have seemed as terrible. While a Christmas release insures them maximum profits, how can they make profits off of a system that isn't on the shelves? Also, if they had pushed the launch back, they would have had more titles available at launch to silence those naysayers, as well as not having to worry about so many pushy parents. The harcore gaming crowd still would have sold out the first shipments, and jackasses that aren't gamers would be content to just wait it out instead of feeling like they had to get one for their kid for the holidays. The launch strategy just seems flawed.

[ruprect]

Blah! The technology reporters for general news sites and newspapers suck.

Not only do they not understand what goes through most gamers minds, they also seem to have no concept about taking things said on the internet with a grain of salt.

The only thing that will kill the XBox 360 is if all the games that come out for it suck. If they don't get a must have title out before Sony's console hits the streets they are in trouble. . . unless Sony charges $100+ more for their console or if their games suck too.

[XenonCJ]

I really don't know what the hell shortage people are talking about here, I've seen "core" systems at Target (Houston) TWICE now (no premimums), after the initial launch date.

My advice? Go to a non-electronics generic type store, early in the morning to get one... Sears, Target, some department stores, Sam's Club, Costco, Conn's... Skip Best Buy and it's clones, that's where everyone goes 1st.

[GrinR]

I keep saying it and nobody ever refutes the god's truth of it - any new supplies of the X360 are far more likely to be snatched and resold on eBay than they are to be simply bought and used at home. This means that a LARGE portion of "new shipments" are being black-marketed, and the consumer gets a meat tamale in the pooper.

MS is the primary point of failure. The retail supply chain is the secondary point of failure.

[DrHogie]

What's this? Chip shortages?

Hmmmmm . . the same kind of low-yield problems that became one of the reasons Apple quit doing chip business with IBM in the first place?

The catch is (IIRC), MS and Nintendo will depend on IBM for the chip production. Sony maaay have their own fab plants for the Cell, but I'm not for sure on that one.

At any rate, this isn't the first time IBM's had problems coming through on a chip order.

[GrinR]

I really don't know what the hell shortage people are talking about here, I've seen "core" systems at Target (Houston) TWICE now (no premimums), after the initial launch date.

My advice? Go to a non-electronics generic type store, early in the morning to get one... Sears, Target, some department stores, Sam's Club, Costco, Conn's... Skip Best Buy and it's clones, that's where everyone goes 1st.

Xenon, you live on the fucking MOON, of course there are units available there!

[fitbabits]

Also, if they had pushed the launch back, they would have had more titles available at launch to silence those naysayers...
Naysayers will never be silenced, especially those who dislike Microsoft. And how many more lauch titles do you think they should have had? Isn't 18 enough? I've still to play my way through PGR3, CoD2 and Kameo. Which means I have at most another 15 games to try before the launch well runs dry.

[Evil_SPanKY]

All stores are getting new units each week.

i can personally tell you this is bs. the eb i work part time at has yet to receive 1 since launch. if these don't start coming in by mid january, i believe this will hurt MS because people at our store are beginning to get a little annoyed.


No, this is BS. If your store is not getting shipments, talk to corporate, cause they (corporate) are sending to other stores, pre-orders, whatever. I have seen first hand additional shipments coming into multiple stores in my area. Gamestop, Target (Whoddathunkit?), WalMart.

Maybe they (corporate) are hording like Best Buy is....until a sale, who knows...

EDITED - For teh splelnig!

[Javi]

I really don't know what the hell shortage people are talking about here, I've seen "core" systems at Target (Houston) TWICE now (no premimums), after the initial launch date.

My advice? Go to a non-electronics generic type store, early in the morning to get one... Sears, Target, some department stores, Sam's Club, Costco, Conn's... Skip Best Buy and it's clones, that's where everyone goes 1st.


maybe you'd like to tell me exactly where. I've been looking, and no luck (249 area,galleria).

[Mason]

Hah hah, the shortage keeps the 360 in the news constantly and makes it a more valuable item than its base price suggests. Hell, there's a Ford dealer or something down here that gives you a free 360 when you buy a car. The impression that the 360 is precious is helping it maintain positive mindshare until the next wave of games come out in Q106, when its demand will rise considerably and supplies will be around to match it. Artificial demand FTW.

[doyama]

The Xbox360 shortages are just a reality of the Just In Time model of modern consumer economics. People say that Microsoft should have had warehouses stacked to the rafters with stuff before the launch, but this is simply unrealistic in today's market. Almost every major retailer, supplier, manufactuer operates on a JIT model. Stuff goes in, then goes out almost immediately. Inventory is waste, and is meticulously avoided by all retailers and suppliers.

Microsoft itself has no method of storing millions of Xbox360s in a warehouse itself. It has no distribution warehouses of its own, all that stuff is contracted out. And the manufacturer and distributors are not going to 'foot the bill' for MS' inventory.

The main problem, and it's a problem in all sectors, is that we cannot handle 'spikes' in demand because of our manufacturing model

[51|RandoM]

What's this? Chip shortages?

Hmmmmm . . the same kind of low-yield problems that became one of the reasons Apple quit doing chip business with IBM in the first place?

At any rate, this isn't the first time IBM's had problems coming through on a chip order.

Apple is in for a rude awakening on this front. Intel isn't going to bend over backwards for every one-off fab run that Apple wants. IBM's ability and willingness to do this for so long was quite unusual, considering how small Apple's orders were.

[ChaosDent]

Apple is in for a rude awakening on this front. Intel isn't going to bend over backwards for every one-off fab run that Apple wants. IBM's ability and willingness to do this for so long was quite unusual, considering how small Apple's orders were.

Not to stray too far off-topic, but I doubt Apple will be requiring as much custom design from Intel, considering that Intel was the target that Apple was flogging IBM so hard to keep up with.

[Goronmon]

Up for discussion - is the current shortage REALLY 'threatening to entirely undo Microsoft's attempts to win the next generation war'?
Though I doubt MS would ever win the next-gen war, any chance they had passes the longer the shortages are in place. You can't win a console as an underdog if you don't have the hardware.

The PS3 will be hugely successful as long as the price isn't too steep. Sony's hype machine will make sure of that.

Sure, this stuff happens at pretty much every console launch nowadays, but that means MS had to do something different this time around in order to increase the market share.

Don't think I am saying that the 360 will fail, just that the longer the shortage goes on, the better it is for Sony.

[rjcc]

In a word, no. Everyone forgets how you could NOT FIND a ps2 at launch. When do did they sell most of the 70 million consoles they sold?

In the first three months of launch, or long after that?

Exactly.

[SkywardShadow]

I work at Target. This is my 4th system launch while working retail. This is also the worst system launch that I have been through. We have received NO units since launch-day. We have MANY angry people in every day asking why we don't have any, and why no one else in the area (Indianapolis) has any either.

No one in the area was provided very many units for launch day either. I keep seeing Microsoft execs throwing around numbers.. like 50 per store. Local stores had an average of 12 each.

[Zeal]

I totally believe this.

It's the same reason Apple left IBM for Intel. IBM just can't make enough fucking chips.

[JediSanf]

I don't think this is (right now) Microsoft's fault. After seeing the Best Buy "hold'em till the 18th" plan I'm suspicious of coporate distribution.

[motor]

I think people are both right and wrong about the shortage hurting Microsoft. It certainly cannot be good (I don't think the shortage is keeping the 360 in the news except among hard-core gamers, the media is too savvy for that now, remember all the toy shortage stories over the years, the media doesn't like being used that way, so they don't do those stories much anymore). As for hurting, I don't think it will have much impact for the next few months, but it won't be long before the PS3 media juggernaught begins (I'm guessing sometime around March and by E3 their will be more "in-game" ps3 movies floating around then you can shake a stick at) and once that happens more and more people will start saying to themselves, "Maybe I should wait and see if this ps3 is really as powerful as they say" Now whether the ps3 is actually more powerful I'll leave to the fan-boys at this point, but an increasing number of people will start waiting after the ps3 propaganda really hits. So I think as long as Microsoft can have their supply issues resolved before the beginning/middle of the year they will be fine, otherwise, it is going to be a real problem for them.

[Dracula-X]

Not a big deal I think, part of the growing pains process. This thing will iron itself out soon. Far in advance of the Rev/PS3 media blitzing anyways...

[Vandenh]

We all know that in the end MS is invincible.... the question is "how long is Sony gonna last"? ;)

[rjcc]

I work at Target. This is my 4th system launch while working retail. This is also the worst system launch that I have been through. We have received NO units since launch-day. We have MANY angry people in every day asking why we don't have any, and why no one else in the area (Indianapolis) has any either.

No one in the area was provided very many units for launch day either. I keep seeing Microsoft execs throwing around numbers.. like 50 per store. Local stores had an average of 12 each.

I have not seen any microsoft exec quote a number per store,so you're going to need to provide a link or thats bullshot.

Shipments definitely are going out, because I know people who have gotten theirs within the last three days from supplemental shipments.

[SkywardShadow]

I have not seen any microsoft exec quote a number per store,so you're going to need to provide a link or thats bullshot.

Shipments definitely are going out, because I know people who have gotten theirs within the last three days from supplemental shipments.

A quick search of what I've read on EA here gave me this: http://www.evilavatar.com/forums/archive/index.php/t-7210.html

No store that I've researched had anywhere near that number on launch day.

I personally have no clue why our large regional area has not gotten any follow-up shipments, and didn't mean to imply that I did. For all I know, Target too is holding them back in the warehouses to force shoppers in on certain days to capture sales. It seems weird that every retailer in the area would do this though.

With past launches, not all shipments went through the warehouse though. Every day we receive "freight" through UPS and FED-EX, and I remember receiving PS2s and Gamecubes this way in the middle of the day. Most of our software comes in this way.

[rjcc]

MANY stores got 50, wal-marts and best-buys especially, i know several gamestops in my area got that many.
That quote is hardly a statement about how many each store got, it was an example of managers overselling preorders, hardly a "every store got x number" and some did get that many, apparently not yours.


A quick search of what I've read on EA here gave me this: http://www.evilavatar.com/forums/archive/index.php/t-7210.html

No store that I've researched had anywhere near that number on launch day.

I personally have no clue why our large regional area has not gotten any follow-up shipments, and didn't mean to imply that I did. For all I know, Target too is holding them back in the warehouses to force shoppers in on certain days to capture sales. It seems weird that every retailer in the area would do this though.

With past launches, not all shipments went through the warehouse though. Every day we receive "freight" through UPS and FED-EX, and I remember receiving PS2s and Gamecubes this way in the middle of the day. Most of our software comes in this way.

[SkywardShadow]

The Best Buys in Indianapolis, one of the largest cities in the nation, received 16 or so each. Wal-Marts 12 or so each. Target 14 each. Perhaps in some areas, like New York.

I believe the quote -was- an example of how many stores got. I would bet that it was meant to make people think that plenty of systems went out, as well as illustrate the pre-order problem.

I'm not trying to be anti-Microsoft, and in fact I hope the 360 gains what it needs to overtake the PS3 when the time comes. I simply wish to state that I believe this launch to be inferior to past launches, where systems were still rare, but not as impossible to find.

[mister_slim]

The original interview (http://www.canada.com/ottawacitizen/story.html?id=9025308d-8bf9-4f67-b472-920febe6ca5e&k=99239) is pretty interesting. The 360 comment is just a little aside at the end.

[WhiteCrow]

2 of my local Wal-Mart's got 10. One got 5. The local Sam's Club in the area also recieved 10, with Best Buy getting the most in the area with a whopping 20. Not many at all.

[XenonCJ]

maybe you'd like to tell me exactly where. I've been looking, and no luck (249 area,galleria).The new Target in Meyerland, near Bellaire on 610.

Here:
http://www.meyerlandplaza.com/meyerlandplaza/directions.html

[chloroformcologne]

All stores are getting new units each week.


i can personally tell you this is bs. the eb i work part time at has yet to receive 1 since launch. if these don't start coming in by mid january, i believe this will hurt MS because people at our store are beginning to get a little annoyed.


yeah. i work at a GS and we have been told to expect weekly shipments and havent recieved anything in over two weeks. bastards.