European Retailers Warn About Extremely Tight Supply for Xbox 360

by Anton Shilov
11/25/2005 | 10:47 PM

Several retailers in <%BANNER[article]%>Europe are reported to have said that they either unlikely to have Xbox 360 on shelves at the launch date on the 2nd of December, 2005, or will have very limited availability. While the demand in the U.S. is already exceeding supply, further shortages may slowdown adoption of the console in Europe and Japan.

Two of the top U.K. retailers of computer games and consoles, HMV and Woolworths, both said that they would have no Xbox 360s available on December 2 for those who have not pre-ordered, while the leading electronics retailers Dixons and Comet said that stocks were extremely limited according to a report at EETimes web-site.  

While retailers have been known to exaggerate supply shortages to try to get consumers into their stores, it is unusual for so many to suggest to would-be buyers that they should not bother because they have no stocks left, the web-site notes.

Analysts expect the Redmond, Washington-based software giant to ship between 1.5 million and 2 million Xbox 360 consoles to sell in the retail this year, up from 1.5 million of the original Xbox consoles which were planned to be shipped in 2001. Microsoft is aiming to sell 2.75 million to 3 million Xbox 360 units in the first 90 days after the launch date, according to some reports.

The three companies contracted by Microsoft to build the Xbox 360 are Flextronics International, Wistron and Celestica, but Celestica plant is expected to come online in January, 2006/

While due to high building costs of game consoles initially it would be financially better for Microsoft to ramp up manufacturing slowly, higher pace would allow the company to penetrate the market more widely, capturing market share away from Sony and its yet-to-be-released PlayStation 3.