Market Analysts Doubt 360's Success

If appearances are anything, it seems that Microsoft’s Xbox 360 may be having a bumper crop year. Since its release, shortages of the game machine have abounded, as gamers desperate for the scarce item, have either had to wait long periods of time for restock shipments or pay exorbitant prices on internet auction sites such as eBay. But some analysts question the success of the 360. According to Reuters, Buffalo portfolio manager, Bill Komitzer, took issue with popular opinion by saying, "By and large, we’re not going to be hoping for great things from Microsoft, because Xbox wasn’t a blowout this year and it doesn’t look like PCs were a blowout.” His comments seem rather odd as demand for the 360 has outstripped production numbers. However, Komitzer,s reasoning about the Xbox 360 not being “a blowout this year” is most likely based upon the inability of Microsoft to produce enough 360s to meet consumer needs. Any product can be popular, but if the product can,t be sold because of shortage gaps, it does nothing to shore up sales figures or profits for the company. This may be a semi-sweet victory for the “Big M.” They have won the battle for early market share and have established their 360 as a viable contender for “best next-gen console” status. But the downside to this is that they have fallen short of expected sales figures because they don,t have enough 360s to go around. Time is working against Microsoft. Potential buyers of their 360 may start to lose interest in purchasing the machine in favor of a “wait and see” attitude as Sony and Nintendo will be releasing their next-gen offerings later this year. If Microsoft expects to continue their ride of success on their 360, they,ll have to find some way to meet demand before frustrated consumers decide to go elsewhere for new game console hardware.