Tuesday, November 14, 2006

Console Launches: Onward, Into the Fog

I remember the good old days.

In the good old days, you walked into Electronics Boutique a few months before a console launched and put in a pre-order. The day the system launched, you walked in and picked it up, bought a few games, and went home.

The day the PS2 launched, I was in a queue of about thirty people when EB opened. We just wanted to pick up our consoles as soon as possible.

Chaos? Zero.

Last year, the Xbox 360 launched. For me, it actually wasn't that much different than in 2000. I was still able to place a pre-order in late summer for the November launch, and except for the midnight launch, nothing much had changed.

After the launch, though, it got crazy.

Thousands of systems for sale on Ebay for 2x (or more) the retail price. Microsoft did pull off a simultaneous, worldwide launch, but they never thought about how difficult it would be to resupply those territories. So the launch wasn't bad, but post-launch was an absolute disaster.

Fast forward. Two major consoles launch this week. Both of them, right now, are totally FUBAR.

Let's talk about Sony first. The PS3 launch in Japan featured large numbers of paid drifters waiting in line to purchase consoles that would immediately go up for resale. From the Times Online:
In Akihabara a dozen homeless men queued incongruously in front of a game shop to buy the console. Each was being hired by a middleman to circumvent the shop’s “one customer, one PlayStation rule” to ensure the biggest number of consoles for immediate resale.

And more, from Kotaku:
Unfortunately for her and the rest of the Sony entourage, the men and women standing patiently in the front of the line either didn't understand what she was saying, or didn't care - the first buyers of PS3 were largely elderly Chinese men and young Chinese women with shaky Japanese language skills.

...This is the true face of the PlayStation 3 debut in Japan. Hardcore gamers are not here waiting in line overnight, buying a first-run PS3, and running home to play some good old next-gen gaming. Rather, opportunistic Japanese businessmen have the largest presence, hiring poor Chinese men and women to wait in line for a PS3, one which will later be sold on web auctions to wealthy gamers around the world for exorbitant amounts of money.

Oh, hell. I'm an idiot for not seeing this coming. I was really, really pleased when it was announced that the PS3 would be region-free, because we could play Japanese games immediately, but I didn't see the secondary implication: cross-region reseller demand for all launch territories, because all you need is a voltage converter and you're good to go.

That combines to create a real launch disaster. I wouldn't be surprised at all if over half of the launch systems actually went to resellers. Here's more from the Kotaku article:
"Thank you for your patience!," welcomed the cashier to the first PS3 buyers. "What game software would you like with your purchase?"

"Hai," the consumer nodded, not understanding the question.

Most cashiers soon figured out that the men and women standing in front of them didn't speak Japanese. Some would then repeat the same question in English, and would all get the say reply, "Only hardware."

Based on my observations of the first twenty PS3s sold at Bic Camera, they were all purchased by Chinese nationals, none of whom bought any software. After making their purchase, television crews asked for interviews but all were declined. These temporary owners of PS3s would then make their way down the street where their bosses waited. After several minutes, a dozen PS3s were rounded up, as their Japanese business manager paid out cash to those who waited in line for them. I witnessed a homeless-looking Chinese man, in his sixties or seventies get paid 20,000 yen for his services and was then sent away.

I added the bold emphasis. Translation: low attach rates, presumably.

And if you're wondering what "Bic Camera" is, it's a leading electronics seller in Japan. This particular location was visited by none other than crazy Ken Kutaragi. So it was one of the premier locations for the launch.

In the U.S., people waited in lines for hours just to place a pre-order. Which didn't actually mean an order, more of a chance at an order. Here's an excerpt from Next-Gen:
GameStop director of public & media relations Chris Olivera told Next-Gen that its pre-order allocation for PS3s is lower than anticipated. “Sony did notify us that our initial shipment will not be what we expected,” he confirmed.

Specific allocation numbers were not revealed.

Nothing like waiting for five or six hours to be sure you have a system on launch day, put down a deposit--and then get nothing on launch day.

Now that I think of it, I think Microsoft short-shipped Gamestop for the 360 launch, too, but there sure weren't people waiting hours in line to place pre-orders.

At this point, no one really knows what the hell is happening on launch day. The only thing anyone has figured out is that you need to get in line very, very early, and even that may not work.

Is scarcity going to drive demand? It would at $299. Actually, it would at $399. But at $499 and $599, with exactly one original game that looks interesting (Resistance: Fall of Man), I doubt it.

So is this launch going to do anything besides piss people off? Sure doesn't look like it.

Oh, and if you live in the Austin area and desperately want a PS3, I think I have a couple of locations that would improve your chances. Just e-mail me.

Now, I'd like to say that Ninendo's done a much better job here, but who the hell can tell? They claim there will be more launch units, and far more in the "launch window," but that hasn't stopped pre-orders from selling out in minutes, and there haven't been many pre-orders, anyway. It's a big black hole right now in terms of information, and it's incredibly annoying that pre-orders are so few in number.

It's ridiculous that a console launches in less than a week and we haven't been told which chains are getting the most systems, or that procedures aren't already in place (and posted) to help us figure out where we want to go. It's as if both Sony and Nintendo want to annoy us as much as humanly possible. And all they've accomplished is to guarantee that people are going to be incredibly pissed off on launch day.

That's really kind of a bad idea, isn't it?

I have found one site that seems very useful. You can put in your zip code and it gives inventory information for Gamestop/EB, Wal-Mart, and Target, and even puts the locations into Google Maps to make it as conveninet as possible. I doubt that all of this information is accurate, but at least it's something. Here are the links:
Wii launch inventory
PS3 launch inventory

Overall: grumble, grumble, grumble.

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