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Sunday, November 06, 2005

Rumor: Is the Xbox 360 shortage deliberate?

Rumor: Is the Xbox 360 shortage deliberate?

"Source: Reports from numerous sites collated together on the hardware-happy Arstechnica.

The official story: "Microsoft does not comment on rumors and speculation."--Microsoft autoresponse.

What we heard: With the Xbox 360 still set for a November 22 launch, many gamers are realizing that they will be getting their first taste of sweet, sweet next-gen goodness in fewer than three weeks. However, a lot of people haven't been able to lock down a preorder of the console, which has become near impossible to get online unless you want to fork out $2,000 for GameStop's Omega Bundle.

Most gamers chalked up the 360 supply issues to general platform-launch woes. However, Arstechnica offered a much more conspiratorial theory. They propose that Microsoft is engineering the supply chain so the Xbox 360 will sell out at most locales. Why? Two reasons. First, widespread sellouts would create the appearance that the console is so popular that retailers can't keep it in stock. And actually, it wouldn't be an appearance, as it would technically be true. Then the media would pick up on the shortages, generating even more buzz about the console and giving it more free publicity.

Such a wily approach would fit right into Microsoft's publicity campaign. The company has jumped onto the viral marketing bandwagon with both feet, using the infamous alternate reality game (ARG) to promote Halo 2 and to give the world its first glimpses of the Xbox 360. After using ARGs to hype Xbox 360 contests, the company has now launched another one to promote the Xbox 360 launch.

Though not an ARG, an artificial 360 shortage would also set the stage for a new technique called targeted marketing. Practiced by companies such as San Francisco-based Ammo Marketing, this rather insidious selling style targets "influencers," people whose behavior others want to emulate. Companies hire influencers to use their products in the hopes their friends will see them using said product and then emulate said friend's behavior.

In the case of an Xbox 360 shortage, only the hardest-core Xbox fans will go to the lengths it would take to obtain the console, like waiting in line overnight. Eager to show off the coveted item they were luckily enough to get, these ubergeeks will become miniature 360 evangelists, inviting all their friends over to play. Then those friends go out looking for the hard-to-find consoles, locate one, and then show it off to all their friends...who then all want to get one, und so weiter.

But is there any evidence that Microsoft is manipulating supply to artificially create demand? Sort of. Arstechnica refers to several well-respected Web sites that have received e-mails from readers claiming to be retail employees. Kotaku posted a report from an anonymous Target clerk saying each location is only getting 10 to 50 units of the console. Each Target location has also been instructed to preprint a giant "Sold Out" sign in advance to slap on the front window the minute the last next-gen machine is gone." [more]

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