Microsoft discusses hardware shortages, fuels GTA IV fire
By Andrew Webster | Published: February 15, 2008 - 12:12PM CT
During an interview with NextGen.biz, Microsoft's David Dennis answered some questions about the company's recent problems with hardware shortages. According to Dennis, the problem was simply that the demand was much greater than expected. "We saw the sales outpacing our forecasts as far back as November," he explained, "but because we had inventory built up in advance of the holiday, it really didnt become a shortage issue until the latter half of December. The sales continued to be robust through January, so it just continued to worsen." Dennis went on to say that Microsoft has increased production, and he expects that they should be able to catch up with demand by March.
Dennis also explained that while the PlayStation 3 was able to sell more units in January, he believes that this was mainly due to the supply constraints faced by Microsoft. "I hate to predict," he said "but I certainly believe that once we get the supply out there, with the demand continuing, that wed certainly hope for the 360 to get back into its pre-holiday rhythm." Part of the reason, Dennis says, is because of the "marketing muscle" that the company is going to put behind some of the big-name software being released in the coming months. Strangely, he used Grand Theft Auto IV as his example, despite the fact that it will be coming to both the PS3 and 360. He then went on to fuel some of the fire surrounding that game by saying, "We believe that the value-add of having additional premium content for Grand Theft Auto on our box will certainly be a sales driver for the console."
The next couple of months will reveal a lot. In March, we will get to see how a healthy stock of 360s fares against the surging PS3, while in April we finally get to find out once and for all what Microsoft gave Rockstar all of that money for.