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[Wario64]

http://www.gamespot.com/news/2004/12/09/news_6114764.html

Sony officials today confirmed to Reuters that the company was using the expensive means of air freight to get as many PlayStation 2 units as possible onto console-starved retailer shelves in the US. The units are being flown directly from manufacturing facilities in China to US shores, according to Reuters.

The unidentified spokesperson said the practice had been going on "for some time."

The industry has been watching the PS2 shortage story play out now for months. In a memo sent to investors this morning, Friedman, Billings, Ramsey & Co. analyst Shawn Milne said, “As expected, PS2 supply remains an issue.” He projects a shortfall of just 200,000 units would impact publishers of PS2 software to the tune of $11.6 million. That’s over $11 million in lost revenue.

"We lowered our PS2 hardware unit assumption to 2.75 million in the December quarter from 3.1 million in the year-ago quarter and slightly reduced our PS2 software growth estimate from 10 percent to 8 percent. We believe the PS2 hardware shortfall may limit upside in software sales in the quarter," Milne said in the memo.

American Technology Research analyst P.J. McNealy told Reuters, "The additional costs could cut any margin [Sony] makes on the PS2 unit nearly in half." He commented that even in spite of the extra effort Sony is going to to address the shortfall, it likely won’t be enough to prevent shortages in some markets.

Industry analyst Boris Markovich of TerraNova Institutional told GameSpot today, "Sony bled the channel dry of the older PS2 systems but did not ramp the new hardware fast enough to satisfy consumer demand." Still, he didn’t sound entirely critical. "Clearly, Sony is trying to do everything it can in order to satisfy retailer demand for the hardware."

But "everything" may not even be enough. Markovich concludes that today's November revenue figures released by sales tracking company NPD reflect the ongoing shortages of PS2 consoles. "We believe that today's weaker-than-expected NPD results of only 2 percent industry growth in November were directly attributable to the PS2 shortage."

 

[BeOnEdge]

i think the 2% growth was attributed to the gamecube sucking but hey thats just me.

 

[PhatSaqs]

This is some great marketing

 

[soundwave05]

Sony really dropped the ball with this whole PSTwo situation.

Why even have a transition like that, right in the middle of Christmas no less.

If they wanted to boost sales they should've just made a new bundle or something.

Its sorta like getting asked out on a date with a cute girl and having all week to do errands, but you decide to do the errands right before the date and end up being late. You cannot have supply screw ups during Christmas, thats prime time.

 

[sc0la]

A lady today acted like it was my fault we didn't have any PS2s.

That is going to get more fun every time it happens as christmas gets closer.

 

[Doom_Bringer]

This is some great marketing

How is this marketing?

 

[jedimike]

This is some great marketing

Exactly what I was thinking... Sony are the masters of playing "the shortage" card.

 

[Chi-Town]

I've actually seen small batches of PS2's at Best Buys in my area. The catch?
They only have them available bundled with a 2nd controller, a memory card, and a replacement plan for a total of $230.

 

[soundwave05]

The "shortage" thing is only beneficial IMO if you're launching a product.

Not having PS2 on shelves right now is hurting Sony, look at the NPD sales, its given Microsoft a chance to outpace them during November.

They'll probably bounce back for December and take a commanding lead again, but damn, this is a pretty bad time for this.

The people looking at buying a console right now are more casual/budget shoppers, you're not going to whip them into a frenzy by faking shortages, those people will just buy something else.

 

[FitzOfRage]

How is this marketing?

People always say that, and the reality is that not every shortage is a brilliant marketing scheme hatched in a dark office. Sometimes companies just screw up.

If anything, the brilliant marketing is having people praise the screw ups as brilliant marketing.

 

[jedimike]

People always say that, and the reality is that not every shortage is a brilliant marketing scheme hatched in a dark office. Sometimes companies just screw up.

If anything, the brilliant marketing is having people praise the screw ups as brilliant marketing.

The reality is that PS2 and Xbox both have shortages... but they certainly aren't critical. If one store is out just go to the next store, they'll probably have it in stock. Sony just makes a bigger fuss about it to start a consumer feeding frenzy. Unfortunately, it seems to pay off for them 100% of the time.

 

[soundwave05]

No I do really think there is a genuine shortage.

Halo 2 is big don't get me wrong, but there's no way XBox would be able to outsell the PS2 for the several months that it has without shortages for the PS2.

Sony should've released the PSTwo in late September and given themselves an extra month to get production going. Switching models like that right before the important holiday season and forcing retailers to bleed out old inventory was a risk and they're getting burned for it.

 

[JoshuaJSlone]

Bizarre. I remember they had to use air shipping back in 2000, but I wouldn't have guessed they'd repeat that in 2004.

 

[teiresias]

The reality is that PS2 and Xbox both have shortages... but they certainly aren't critical. If one store is out just go to the next store, they'll probably have it in stock. Sony just makes a bigger fuss about it to start a consumer feeding frenzy. Unfortunately, it seems to pay off for them 100% of the time.

I'm sorry, but that's certainly not the case where I live, at least in the big retailers like Best Buy and Circuit City, I haven't really been to any of the smaller shops like Gamestop or EBgames though. I've been to every Best Buy and Circuit City in my area numerous times the past few weeks to do some comparisons and stuff while I've been doing research for buying a laptop. None of them have had stock for weeks if not months, I can't remember the last time I saw a PS2 in a store - and I've NEVER seen a PStwo in a store, but I wasn't really looking for them immediately after release, but there certainly aren't any now.

As I said, this is obviously just anecdotal (I so can't spell that) and for my area, but that's what I've witnessed, so it's not all just marketing and hype.

 

[sc0la]

I would think the goal of an artificial shortage would be to push extra demand, then get product in the store so everyone could buy it. A shortage just after thanksgiving is nice, if the units are there by christmas for everyone to buy.

You might beable to try and convince me this was artificial if a)they sent more than four every other week to my store or b) they weren't airlifting them out of china.

When you make an artificial shortage you slow production and time shipments to hit when you want, you don't spend a shit load of extra cash air lifting your product out of another country, that defeats the purpose.

 

[TekunoRobby]

A lady today acted like it was my fault we didn't have any PS2s.

I saw a lady in Best Buy pubicly cursing Sony that it was their fault they don't have enough PS2s and they were doing it on purpose. It was actually kind of funny that some consumers think that these companies are purposefully limiting their supplies of systems to create demand. Silly people.