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Saturday, November 05, 2005

Rush begins for Xbox 360

Rush begins for Xbox 360

"Microsoft video console selling out before Nov. 22 launch

Microsoft Corp.'s Xbox 360 video game machine is already sold out on some Web sites, including Wal-Mart Stores Inc., a sign the company may have shortages when the console goes on sale this month.

[Click image for a larger version] Associated Press
Associated Press
A sign in a CompUSA store promoting the new Xbox 360 is displayed next to the current system.

Wal-Mart's site tells people to go to a store at midnight Nov. 22, the day Xbox is released in the U.S. says the system is unavailable in the U.S. and warned U.K. buyers that they may not get it by the holidays.

Bids on eBay reached as high as $4,100 this week and were as much as $1,775 for a machine with 20 games on Thursday.

But shoppers who didn't pre-order their console months ago aren't completely out of luck.

Chris Olivera, a spokesman for Grapevine-based GameStop Corp., the nation's largest games-only retailer, said that although many GameStop stores have already depleted their initial allotments of Xbox 360 systems through pre-orders, some stores should have consoles on the shelves on launch day.

"It's going to depend market by market what is going to be available," he said.

Mr. Olivera said GameStop is still in daily negotiations with Microsoft to determine how many consoles the retailer will receive.

Wedbush Morgan Securities analyst Michael Pachter estimated in October that GameStop would have about 300,000 consoles on launch day and an additional 150,000 in January.

If evenly distributed across GameStop's 4,200 stores worldwide, that equals about 70 consoles per store.

Large, busy stores are likely to get more systems, though.

Microsoft is counting on the Xbox 360 to snatch sales from Sony Corp.'s PlayStation line. But Microsoft may not be able to capitalize on the demand if too few units are available.

"People are going to have to go to extreme measures to get an Xbox 360," said Evan Wilson, a computer games analyst at Pacific Crest Securities in Portland, Ore. He said he doesn't own Microsoft shares or rate the stock. "From Microsoft's perspective, they would have liked to get out more units."

Even customers who pre-ordered aren't guaranteed a console on launch day.

Mr. Olivera said that some customers might have to wait for the second wave of consoles, which is expected from Microsoft sometime before Christmas.

Microsoft plans to ship 4.5 million to 5.5 million Xbox units by June, which would generate at least $1.35 billion of sales." [link]

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