360 Supply issues from When the Box "Comes Together"

[bapenguin]

Dean Takahashi (http://blogs.mercurynews.com/aei/2005/12/a_visit_to_redm.html), author of the Opening the XBox (http://www.amazon.com/gp/product/0761537082/102-3099867-1429749?v=glance&n=283155) book, recently visited Redmond while doing research for his new book on the 360. He brought back one interesting tidbit of information. It looks like the supply issues for the 360 aren't being caused by chip yields or some marketing ploy, but rather the sum of the parts of the system itself. Here are some tidbits from our conversations. Microsoft is disappointed that it can't get more units of the Xbox 360 into the market. Various folks tell me it isn't a problem with chip yields. I think it's more of a systems issue, when the boxes come together. They're working on getting more units out. There are rumors Best Buy will have some supplies to sell on Sunday. Microsoft wouldn't comment.

Could there be a quality issue with systems overheating? Maybe something else?

[phantomhitman]

so the kids cannot put them together as fast as they originally thought?

[El Gato]

Maybe Microsoft should do an IKEA and sell them as flat-pack kits.

[Vandenh]

How long would it take to put one together? 10 minutes? That means about 80 a day per child laborer :) 300.000 a month means 200 people working on this.

[drakkarim]

if they released them any faster (i.e. at a normal pace) then they would suddenly not be sold out all the time, and that would look bad for marketing. last i checked ebay ones aren't selling all that well :) so all those that REALLY wanted one, probably have one by now. the rest of us are waiting for the price drop or for some more ps3 info.

[MrMeatshake]

if they released them any faster (i.e. at a normal pace) then they would suddenly not be sold out all the time, and that would look bad for marketing. last i checked ebay ones aren't selling all that well :) so all those that REALLY wanted one, probably have one by now.

but *** have denied that this is an artificially-created lack of systems (and therefore free marketing++). surely they woulnd't LIE. i agree that this is much more suspect than actually having a supplier that can't supply a part. this can ONLY be the fault of ***. so where was the decision to not employ more kids made? and why has it not been rectified by the awesomely complex solution to this conundrum: 'pay more kids'.

the rest of us are waiting for the price drop or for some more ps3 info.

yep. it's just making me less keen 2 get one until the price comes down, now :) thanks ***!

[atariv8]

I've got $400 burning a hole in my pocket I've saved up to late to preorder a 360. I have to say the closer to the PS3 launch I get and the more I have to wait to get a 360, I'm wondering if I should just plop down a preorder for PS3 (price and launch date still up in the air though). I'll end up buying them both but one will have to wait for another year or so.

[Vandenh]

>but ***

Hu? What?.. oh sorry I stopped reading after that $

[BleedTheFreak]

I actually got mine finally. I waited at Best Buy for 5 hours from 2:30 to 7:30 and up until about 30 min. before they handed out tickets, I was 18th in line. Then, suddenly, I was about 27th. Why? Folks who were waiting in cars were let into the front line by the jerks up there, as well as folks who just showed up and were friendly with the guys who were in the front. So, I was number 27 out of the 25 tickets they had. :(

But, then the next day, Monday night, my wife came home from shopping and once the kids went to bed, she pulled a Premium out of her car! I about crapped myself. It even had the remote! Yay for a good woman!

[bapenguin]

last i checked ebay ones aren't selling all that well :) so all those that REALLY wanted one, probably have one by now. the rest of us are waiting for the price drop or for some more ps3 info.

Microsoft Xbox 360 - Game console
Average starting price: $901.25
Average sold price: $1,337.99

That sounds pretty damn good to me....though it looks like the latest auctions are going for around 700 or so for the premium...which is still almost friggin double.

[Cubfan]

if they released them any faster (i.e. at a normal pace) then they would suddenly not be sold out all the time, and that would look bad for marketing. last i checked ebay ones aren't selling all that well :) so all those that REALLY wanted one, probably have one by now. the rest of us are waiting for the price drop or for some more ps3 info.

At launch Microsoft had maybe 50 consoles (at most?) at stores with 200 or more people wanting the system. They could easily have increased supply to 100 or 150, made much more money and gotten more systems out there, while still maintaining the sell-out marketing angle. It doesn't make sense that Microsoft would artificially be limiting the supply. They could put a lot more 360s out there and demand would still not be met. As for ebay, not sure how those are selling, or how one can determine that, but I'd imagine there is a limited market for those willing to shell out 200-400 extra for the console. If those same consoles were at stores at regular price, they'd obviously sell.

[MrMeatshake]

At launch Microsoft had maybe 50 consoles (at most?) at stores with 200 or more people wanting the system. They could easily have increased supply to 100 or 150, made much more money and gotten more systems out there, while still maintaining the sell-out marketing angle. It doesn't make sense that Microsoft would artificially be limiting the supply.

i think the point would be marketing and building a 'mistique' around the product. not making more money. the xbox 1 lost absolute ass-loads. so clearly *** aren't in it for the money, yet (they make enough off'v windows and office to keep a small country in bread and milk anyway). if this comes down to not having the staff to assemble the boxes, then SOMEONE has not said 'if i spend $1000 extra a week on kids to build the boxes, i'll make $1m extra at retail' (or something) - they've rather decided to do nothing about it. that seems rather strange.

[motor]

>but ***

Hu? What?.. oh sorry I stopped reading after that $

PLEASE...we get it. Letting us know that you stop reading posts after the *** really adds NOTHING to the thread.

[bapenguin]

i think the point would be marketing and building a 'mistique' around the product. not making more money. the xbox 1 lost absolute ass-loads. so clearly *** aren't in it for the money, yet (they make enough off'v windows and office to keep a small country in bread and milk anyway). if this comes down to not having the staff to assemble the boxes, then SOMEONE has not said 'if i spend $1000 extra a week on kids to build the boxes, i'll make $1m extra at retail' (or something) - they've rather decided to do nothing about it. that seems rather strange.

console manufacturering isn't as cut and dry as "higher more kids."
Did you guys see the video of the manufacturering process from back in October? It's not exactly slap part A into Socket B.

[Mason]

Well also, consider the economics of this. If you created a production chain that could slam out tons of the machines at once for the launch, you'll have a lot more slack once the initial launch is over and people are buying the machines at a lower but more constant rate. It makes more economic sense to spread out the launch consumption over a few months instead of building your production chain around a one-time mass consumption that'll never be repeated.

Not saying that's the end-all justification, but it is at least one factor.

[Montolio]

console manufacturering isn't as cut and dry as "higher more kids."
Did you guys see the video of the manufacturering process from back in October? It's not exactly slap part A into Socket B.

It's too bad Microsoft couldn't emulate Dell's process. I took a corporate tour several years' back and we had the chance to take a bird's eye view of the how it all works. We stood on a elevated platform overlooking a massive warehouse where trucks backed-up to our left, dropped off PC parts that were sorted into prefab forms in giant, crate-like boxes. Then an automated conveyer belt system would carry that box to the first available tech who would then put it all together, ending with a quick series of tests. From there it would go to stricter testing and on to people boxing it all up (tossing in manuals and CDs) and on to trucks leaving the facility.

It was pretty quick.

I'm sure judging by the pictures and video that has made it rounds on the net that Microsoft must have something very similar going on, but those parts just seem to be more difficult to put together because of the smaller size IMHO. That could be total BS though since I'm sure Dell's laptop process is pretty much the same. I really don't know since we didn't get to see that.

All that being said...it pains me to know the majority of my friends don't have their "paid in full" 360s yet and only about 1/3 of my Live friends show-up as having one now. All I keep saying is it's well worth the wait and a total blast to use. Lame I know, but what more can be said y'know. I hope we'll all have them sooner than later and we can all get back to just gaming our asses off and enjoying each other's company online or in person at LAN parties.

By the way - nice frackin' gamerscore bapenguin. 3055 and counting is no joke :-)

How about throwing some of those 733t GeoWars skills this way man heh.

[mister_slim]

Well also, consider the economics of this. If you created a production chain that could slam out tons of the machines at once for the launch, you'll have a lot more slack once the initial launch is over and people are buying the machines at a lower but more constant rate. It makes more economic sense to spread out the launch consumption over a few months instead of building your production chain around a one-time mass consumption that'll never be repeated.

Not saying that's the end-all justification, but it is at least one factor.
Good point. I also imagine *** (that's for you Vandenh, stop whining) noticed that when Nintendo pushed back their GC launches to have more units they actually received less coverage and frenzy than they would have from a sellout.

[Abash Alarmist]

[QUOTE=Montolio]
It was pretty quick.

I'm sure judging by the pictures and video that has made it rounds on the net that Microsoft must have something very similar going on, but those parts just seem to be more difficult to put together because of the smaller size IMHO. That could be total BS though since I'm sure Dell's laptop process is pretty much the same. I really don't know since we didn't get to see that.QUOTE]

However, are Dell's laptops in such a high demand as the Xbox360 consolie right now? I seriously doubt it. There is a demand, but not nearly as high as the one that is being set by the Xbox 360 (which is arguably the most sought after electronic this Christmas Season). If Dell could churn out about a million laptops in the same amount of time as Microsoft is doing with the Xbox360, more power to them. Besides, Dell has a much more experienced grasp on production: they were one of the first people to do the mass production of PCs.

[bobbler]

Average sold price: $1,337.99

Haha, Leet selling price.

[SMES]

PLEASE...we get it. Letting us know that you stop reading posts after the *** really adds NOTHING to the thread.

It might not add anything on a thread by thread basis, but I happen to agree with him that abbreviating Microsoft with a dollar sign lowers the intellegence and quality of the atmosphere and the dialog of the forum.

I am all for keeping that Gamefaqs-esque drivel off of EA, and he has every right to mock it every time he sees it if he thinks it will help stop it.

You can call it elitist, but every other public gaming forum on the net is filled with *** this and $ony that, it would be nice to know people here frown upon it.

[Montolio]

However, are Dell's laptops in such a high demand as the Xbox360 consolie right now? I seriously doubt it. There is a demand, but not nearly as high as the one that is being set by the Xbox 360 (which is arguably the most sought after electronic this Christmas Season). If Dell could churn out about a million laptops in the same amount of time as Microsoft is doing with the Xbox360, more power to them. Besides, Dell has a much more experienced grasp on production: they were one of the first people to do the mass production of PCs.

Hey I'm selfish. I just wish all the various parts came steadily into a assembly site here in the USA where turnaround for the people I know would be that much faster heh. I truly have no idea what Microsoft is doing wrong to cause this issue and almost always believe they don't make a move without a carefully laid out plan. It's hard for me to say this isn't something being done on purpose but I doubt we'll ever really know for a fact. It bugs me to know that there are people out there with 360s sitting in boxes, doing nothing, waiting for that winning bid or whatever.

If only the collective ill will of the waiting Xbox gamer masses could somehow cause them a finger poke to the eye or something equally painful. If any of those people are gamers and haven't opened their box and started enjoying this beast...I don't know what to say.

I mean, how the Hell do you look at yourself in the mirror each day?

Money or playing games on the Xbox 360 - hmm - what to do, what to do. The choice is easy for anyone I would care to know in real life. So many people have told me that I should sell mine and make some crazy cash and I look at them like they have lost their damn minds. To me it's like the ultimate sin or slap in the face of something I've enjoyed since I can remember. Why would I help screw my fellow gamers over? Basically, this is just a mini-rant going nowhere because said people could give a rat's ass about what I've said. I just felt like venting I guess.

Go make your extra money and keep the problem going for the gamers out there who saved their dollars, stood in line, got screwed over by a retailer and on and on. The bad karma will come back to bite you in the ass one day. It's a small problem in the context of real problems but like I said it just bugs me to no end.

[Twigmaster]

Ebay as of the day after release
Average starting price: 1200.25
Average sold price: 8000 and up

Correct me if some of these numbers a bit off.

[Abash Alarmist]

Well, to each their own, my friend. Personally, as a 18 year old college student, I would rather have the extra money rather than having the ability to play the Xbox360. I have bills to pay and I figure that I am smart enough to be able to find my own ways into paying for college; whether it be a fulltime job (which I do have) or a get rich quick scheme (similar to the eBay thing with the Xbox360). To sum it up, it is all based on where does one's priorities lie. Is it in the infatuation for a piece of electronics and plastic? Or does it lie in the lust of money for whatever reasons? It all depends. If the demand is so high, then it is going to seel for insane amounts of money, but is it really anyones fault? The eBayer doesn't usually set the price that it is sold at, but rather the people bidding on the item raises it to the exuberant amount that they pay for. Who is the true victim? Is it the people wanting the Xbox360s but arent able to afford one, or perhaps the people actually reselling the boxes on eBay, or even the people buying the overpriced toys? It all depends on your point of view and that itself will vary with mileage.

[Zeal]

Anyone who pays anything over the retail price of this system is a dumbshit. Even the $400 retail price is pushing it.

[Mav]

It might not add anything on a thread by thread basis, but I happen to agree with him that abbreviating Microsoft with a dollar sign lowers the intellegence and quality of the atmosphere and the dialog of the forum.

I am all for keeping that Gamefaqs-esque drivel off of EA, and he has every right to mock it every time he sees it if he thinks it will help stop it.

You can call it elitist, but every other public gaming forum on the net is filled with *** this and $ony that, it would be nice to know people here frown upon it.

So it's ok to just accept corporate congolmerates that have a proven monopoly on the market? (or at least at one point have had)

Do we even need to site reasons? Obvious ones that the average internet user knows? $200 for an OS that is compatibile with the vast majority of software. Another $200-400 for your basic word pressing package, and on and on and on. Sure you don't need a M"S" product, you can grab various other OSes for free, but when you've been born raised and used to one OS, why should you as a user have to choose to use a different one because the company that makes your current one requires an arm, leg, first born child and soul for newer OS versions and software?

[phantomhitman]

Why does windows dominate the market? If you can answer that, and more specifically find a way to take them out, you are a genious that should be starting up a company right now. Regardless of how windows was either made or stolen, Mr. Gates was an absolute genious for getting windows out there in the world. Because he was at the right place at the right time, and luck was very much with him, that makes him a billionaire dick with world domination on his mind? Please, every person on the planet would have done the same thing, and would still do the same thing to this day, as Mr Gates. Call me a windows fanboy, but I just do not see the hate people have with Microsoft justified in any way. Windows has probelms, major problems sometimes, but everything that comes out now has some recall or problems associated with it. Nothing is going to work perfectly, especially something as complicated as on OS, ESPECIALLY when people are purposely trying to fuck it up on a daily basis.
Sorry...I have to go jump back on Mr. Gate's nuts now. Bye Bye......

[bapenguin]

Ebay as of the day after release
Average starting price: 1200.25
Average sold price: 8000 and up

Correct me if some of these numbers a bit off.

I think you are wrong.

[MrMeatshake]

PLEASE...we get it. Letting us know that you stop reading posts after the *** really adds NOTHING to the thread.

heheheh. i think i might stop using it, now. if he'd just asked nicely...

[MrMeatshake]

Ebay as of the day after release
Average starting price: 1200.25
Average sold price: 8000 and up

Correct me if some of these numbers a bit off.

NO U!



(to paraphrase bap)

[mister_slim]

heheheh. i think i might stop using it, now. if he'd just asked nicely...
By the way, I think refering to MS as MikeRoweSoft conveys how bullying Microsoft can be at times.