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Nintendo and their fabricated hardware shortages

There's probably some sort of legal issue around this, as at that point the retailer is acting somewhere between a pawn shop and a bank - you can see the potential for abuse that kind of scenario would allow for.

Right. I also want to note that I'm not actually suggesting that anybody should do this. I'm just saying that if everyone puts their heads together and decides that the great scalping problem must absolutely be solved, I think that would work!

Edit: And honestly, I'm not a lawyer. I'm not sure if it would be legal or not. But one thing I do know is that I've seen plenty of times with things like hotel reservations where they advertise a lower rate but note that if you book at that rate it's non-refundable.
 
Schrödinger's cat;228697905 said:
I will never forget when I was converting years worth of unused Nintendo Stars into exciting new Wii points.

Of course, I couldn't do this in a simple transaction.

No, I had to exchange stars for virtual Wii points cards, then redeem the cards one by one.

Sadly, I was unable to do all of this in one sitting as Nintendo's site, the same site that was designed expressly to carry out this task, reported that it had no more stock of this virtual product. I would have to try again in a week.

As of that time, any doubts I may have had as to the legitimacy of Nintendo stock shortages were confirmed. I've had no reasons to reassess.


You realize that Point Codes have to be generated in a secure environment and are not created on the fly when you buy them right?
 
I take issue with your use of the word "fabricated". What videogame hardware/software shortages aren't man-made?

Are you saying that Nintendo is sitting on a stock pile of systems that have been manufactured that they do not want to sell? Because that would make no sense. They'd lose money housing those systems.

Are you saying Nintendo is deliberately not manufacturing enough consoles to meet demand? Well, I take issue with that accusation. It also makes no sense.

Are you kidding? This is Nintendo 101.
 
I haven't seen this discussed and was simply wondering if it was acceptable because this is a Nintendo thing. I checked to make sure it wasn't just gamestop and it isn't, several other retailers are reporting the same thing. Nintendo is only allowing an extremely limited number of preorders for the switch system and it doesn't currently look like we will be receiving any additional units outside of preorders. Either they aren't expecting it to do well outside of their hardcore fan base or they are with holding units to manufacture demand. Either way I'm not sure it's a good move on their part.
Do you have any facts to prove that the shortage is a fabrication?

If this is merely speculation. Well in the past Nintendo had issues of too much stock of WiiU's and Gamecubes. So I wouldn't blame them if they decide to be much more cautious this time with production.
 
It has been discussed since the Wii days, when so many games just got a few copies, like Metroid Prime Trilogy or The Last Story
 
There was a thread here talking about people on GAF suddenly clamoring for Wii Us because Nintendo has been recalling them recently to make retail space for the Switch. Especially when the Wii U has been available for years.

So yeah, I'd say it's working. And with this and the NES Classic, I wouldn't be surprise if they do the same with Switch.
 
You can't find one right now, so it hasn't.

It hasn't been restocked.

So yeah, I'd say it's working. And with this and the NES Classic, I wouldn't be surprise if they do the same with Switch.

Why do people keep bringing up the NES classic? It was in high demand before anyone knew there would be low stock. Nintendo lost millions of dollars by not fulfilling the demand. Not exactly a brilliant strategy.
 
If they can't get a single day into preorders without stocking out they are either doing this intentionally or they are screwing up horribly. I'm not saying they should necessarily be able to meet demand at launch but the fact they are off the mark this badly is sad. Yeah a preorder isn't necessarily a sale and they don't want to pay to hold stock either but the fact that they don't have enough stock to meet one day of preorders is beyond pathetic. It's not even like they are rushing the thing for the holiday season either, they could have easily launched a few months later.

Preorders were in and out of stock on Amazon and Gamestop for three days. That is more than sufficient.

There are also reports of preorders for wave two going live as well. Nintendo is doing a much better job than any Console preorder I have ever heard of.
 
And neither does anyone in this thread who are so hell bent on saying that they KNOW it's because Nintendo is being conservative....but that's why (Imo) was mentioned right? And that's why it's all just speculations...right.

There have been plenty of reasonable and detailed posts explaining why this fabricated hardware shortage idea is very unlikely here and in previous threads.
There are Kimishima quotes where he specifically says they don't want Switches to stay in warehouses and if sales are good they will ramp up production. We know that the screen manufacturer is making 10 million screens, we know they've been burned by abundance of stock before, we can also assume, if the leaks about using a custom X1 are correct, that yields can be lower than "normal".

So yeah, no one can say for sure, however saying a company doesn't want to sell their product and prefers to hold them back for some shady reason because uh... beanie babies and stuff that happened in the 80s (and 90s?) doesn't hold a lot of water.

On a related sidenote, even some Nintendo employees (I obviously don't know if it's all or even most) that usually get their products for free and reviewers didn't get a NES mini, doesn't really sound like a fabricated shortage to raise demand to me.
 
Preorders were in and out of stock on Amazon and Gamestop for three days. That is more than sufficient.

There are also reports of preorders for wave two going live as well. Nintendo is doing a much better job than any Console preorder I have ever heard of.

And if you go to Walmart US right now, you could still probably grab a preorder. Still ways to find a Switch if you put in the work.
 
Man, recent amiibo releases had plentiful stock, they could easily keep the shortages going. Nowadays you can get a Marth for $10.
 
Man, recent amiibo releases had plentiful stock, they could easily keep the shortages going. Nowadays you can get a Marth for $10.

Probably because there wasn't a long-term strategy of making toys aimed at kids impossible to find in as much as they just initially underestimated the demand that collectors and scalpers capitalizing on collectors would create. Things have stabilized and furthermore there's a general decline in TTL across the board.
 
How does one go about instantly, seamlessly scaling production to exactly meet demand?

You don't but console launches are planned months in advance and they normally manufacture as much as you can before hand. This scenario is understandable with MS and Sony especially when they include new hardware to market and a shortage happens in a part or two. For Nintendo is less understandable because of their design ethos. The console is comprised of hardware that is established and should be on market for quite sometime. So it is assumed "something" is held up. I personally think it is the deal they made with Japan displays that may be the issue and that they didn't want to manufacture "too" much. That is what hurt Sega with the dreamcast and nintendo is conservative.
 
You don't but console launches are planned months in advance and they normally manufacture as much as you can before hand. This scenario is understandable with MS and Sony especially when they include new hardware to market and a shortage happens in a part or two. For Nintendo is less understandable because of their design ethos. The console is comprised of hardware that is established and should be on market for quite sometime. So it is assumed "something" is held up. I personally think it is the deal they made with Japan displays that may be the issue and that they didn't want to manufacture "too" much. That is what hurt Sega with the dreamcast and nintendo is conservative.
Hmmm... this isn't true at all. Nintendo hardware is usually heavily costumized and has features that require hardware that isn't common in the market, they certainly don't just use off the shelf stuff that's been on the market for some time.

I assume you're thinking about Yokoi's strategy of lateral thinking with withered technology, but that certainly hasn't been entirely true lately (I say entirely because they stuck with PPC for three gens) and it definitely isn't true with Switch.
 
Hmmm... this isn't true at all. Nintendo hardware is usually heavily costumized and has features that aren't common in the market, they certainly don't just use off the shelf stuff that's been on the market for some time.

I assume you're thinking about Yokoi's strategy of lateral thinking with withered technology, but that certainly hasn't been entirely true lately (I say entirely because they stuck with PPC for three gens) and it definitely isn't true with Switch.

It wasn't true with the Wii U iirc. But with the Switch.. which hardware part detailed exactly is unique?
 
It wasn't true with the Wii U iirc. But with the Switch.. which hardware part detailed exactly is unique?
The Tegra SoC is customized and HD rumble certainly isn't commonplace. I don't know about the IR camera as that could be more of a software solution than a hardware one.
 
The Tegra SoC is customized and HD rumble certainly isn't commonplace. I don't know about the IR camera as that could be more of a software solution than a hardware one.

Nvidia and the X1 line around has been around for quite sometime, and they use it for thier shield and shield TV devices. Do you honestly believe that this is cause by nVidia, IR camera or the rumble solution?
 
It hasn't been restocked.



Why do people keep bringing up the NES classic? It was in high demand before anyone knew there would be low stock. Nintendo lost millions of dollars by not fulfilling the demand. Not exactly a brilliant strategy.

You're betting on it not selling out once it is restocked again?
 
Least common real-life occupation among GAF membership is supply chain expert confirmed.

Please. This doesn't require deep expertise, just casual awareness of the realities behind the scenes that many consumers don't give any thought to when throwing around grand conspiracy theories. Beyond that, some of us have worked behind the scenes at companies that do large-scale consumer electronics launches.
 
The reality is that Nintendo is not a company on the scale of Apple or even Sony. They have to balance their factory orders with what they think they will realistically sell in a given time frame. If their predictions are wrong, they will have shortages.

I think they really dropped the ball with Amiibo, but I think with the NES Mini it really was just that they underestimated demand.
 
Why do people keep bringing up the NES classic? It was in high demand before anyone knew there would be low stock. Nintendo lost millions of dollars by not fulfilling the demand. Not exactly a brilliant strategy.

I didn't say that.

Nintendo didn't lose millions of dollars on the NES Classic. They didn't earn it, but losing it is an entirely different story.

What they did do is guarantee a 100% return on an item that cost a fraction of its price to be manufactured, and will on the next stock, since demand is still so high.

Not to mention, keeping retailers in high demand as well affords Nintendo power to do shady shit. Historically, they used manufactured supply shortages of the original NES for retailers not playing ball with their demands. This is mentioned in both Service Games and Console Wars.

My point being: even if (and that's a mighty strong if) they aren't purposefully creating a hardware shortage for the Switch, they unequivocally have in the past.
 
It's been discussed and it's real. I've had my name in for a NES mini controller for almost two months now. GameStop hasn't received any.

I gave up and bought a Wii Classic controller after finding out they work.

It's a Nintendo tactic. Judging by the excuses you'd think they were some tiny mom and pop company that somehow can't figure out how to gauge demand, despite doing this for over 30 years.
 
It'll be just like Amiibos. You can't find them anywhere when they launch and then a mouth later you'll be tripping over the damn things in the gaming section in stores.
 
I haven't seen this discussed and was simply wondering if it was acceptable because this is a Nintendo thing. I checked to make sure it wasn't just gamestop and it isn't, several other retailers are reporting the same thing. Nintendo is only allowing an extremely limited number of preorders for the switch system and it doesn't currently look like we will be receiving any additional units outside of preorders. Either they aren't expecting it to do well outside of their hardcore fan base or they are with holding units to manufacture demand. Either way I'm not sure it's a good move on their part.

For the millionth time.

It's not on purpose. Nintendo is just uber conservative with manufacturing.

There are real world tradeoffs. Opening more capacity is expensive and risky if demand slows down. Starting manufacturing earlier means committing to specs earlier.

Criticize Nintendo's planning but it's not like they dont want to sell systems to consumers who are looking for one.

Shortages HURT Nintendo. Bad will. Lost sales. All gains go to second hand market.

A problem they SHOULD fix is better communication. With amiibo people freaked out because it was unclear whether and when more units were coming.
 
Right. Everyone I think plays their role in this day one HYPEE!!!!!!! culture from manufacturers to retailers to fans. And aside from disgruntled fans who are upset that they didn't get a console at or below MSRP, I don't necessarily think it's a problem that needs solving. But if it did I think the easiest way to handle it would just be to require non-refundable deposits. Maybe as much as half down right up front. This won't stop the scalping of legitimately in-demand products. But it does introduce some degree of downside in terms of trying to make you pause and think "are you sure you want this? Really, really sure?"

Yeah no company will do that. Who would buy from them after that. Why take the heat for some other companies fucked up forcasting or logistics?
 
I haven't seen this discussed and was simply wondering if it was acceptable because this is a Nintendo thing. I checked to make sure it wasn't just gamestop and it isn't, several other retailers are reporting the same thing. Nintendo is only allowing an extremely limited number of preorders for the switch system and it doesn't currently look like we will be receiving any additional units outside of preorders. Either they aren't expecting it to do well outside of their hardcore fan base or they are with holding units to manufacture demand. Either way I'm not sure it's a good move on their part.

I haven't seen this discussed

I haven't seen this discussed

Really?

No I mean really?

I feel like this is the most common discussion on GAF.

Usually I write up a big post. But I just feel like I'm wasting my time now.

See you guys in the next nearly identical thread.
 
What nobody ever seems to explain in real terms is "How does Nintendo tangibly benefit from a supply shortage?" Assume that the Switch is sold out for two months, and the supply constraints end in May. Okay, well, now it's May. The launch hype has worn off, many people have already bought the WiiU version of Zelda and are waiting on another killer app that won't arrive until the holidays. Even a popular console with proper 3rd party support won't sell more than 250K units in May. Whatever pent-up demand they create with artificial shortage won't translate into much more than an extra 100K units. I just don't see how any of the strategists or bean counters at Nintendo could justify anything less than selling every single SKU they could possibly produce.
 
I think this eternal question is a product of people having too much time on their hands and quick access to the internet. This age old conspiracy is always over-thought. Nintendo doesn't benefit, they have at times overshipped, and generally struggle with supply issues when it comes to new products like too many WiiUs, too few Wiis, initial Amiibo scarcity to now where they are overstocked as interest has fallen, too many 3ds units because no one wanted one at that price, way too few NES Minis. There is a reasonable way to look at all of these situations or there is the "Nintendo creates artificial demand" conspiracy angle. And the Switch does not seem to be undershipped. Nintendo outlined 2 million at launch and I think another 1 million for the month of March.
 
It's a Nintendo tactic. Judging by the excuses you'd think they were some tiny mom and pop company that somehow can't figure out how to gauge demand, despite doing this for over 30 years.

But why? To what end? How is not selling products a brilliant plan?

Things I posted in previous threads about this same issue (not even 2 weeks ago)

I would agree if they were on the shelfs now. Even in limited supply. But they missed Christmas and the fact that they are not available still now (as interest begins to decline) means to me that they are not making a calculated decision to hold back supply. They just didn't make enough.

Not malice. Just incompetence.

It's not a shrewd business decision to sell no units for 2 months. And now most people are going to be focused on the Switch or no longer care about getting one as the holidays have passed. Missed opportunity.

So it was their cunning plan to sell nearly zero units during the biggest shopping month of the year? Brilliant!

I can imagine how it played out....



Exec 1: Listen up everyone! We are going to produce the NES mini with 30 games and sell it for $60.

Exec 2: That's a great idea. How will we market it?

Exec 1: A few ads on the web and a press release.

Exec 2: So you are not expecting too many sales then?

Exec 1: Maybe not at first, but get this. We are going to manufacture millions of them...

Exec 2: And do a big launch to major outlets?

Exec 1: Nope. Here is the best part. We are only going to sit on most of them and only trickle out a few from time to time.

Exec 2: But why?

Exec 1: To create demand of course!

Exec 2: Oh I get it! So we will hold on to the rest of them.

Exec 1: Yeah.

Exec 2: Until black Friday?

Exec 1: No, longer.

Exec 2: Ok, that will miss some sales though..

Exec 1: It will be worth it!

Exec 2: Ok, so then right before Christmas? Ok, I can kind of see your point.. I can see this as a stocking stuffer!

Exec 1: Nope, we are going to ship almost zero right before Christmas!

Exec 2: But..

Exec 1: And then none the first half of January!

Exec 2: But..

Exec 1: Demand!!!

Exec 2: But..

Exec 1: Scarcity! Demand! Profit!

Exec 2: So when will we ship them?

Exec 1: Sometime after our next console is fully revealed!

Exec 2: But won't we compete with ourselves?

Exec 1: Not if we totally under-ship the Switch as well. DEMAND! AH HA HA HA HA!! It's gonna be impossible to buy this one on launch day!

Exec 2: But then gamers might buy another console..

Exec 1: Why would anyone buy a console that is available for purchase? Ludicrous! Customers like to go home with nothing to show for their efforts. I wonder if we could make then even harder to get? Like put the retail boxes above a shark tank or something.. We will work out the details later. Point is, every lost sale will pay off in pure demand!

Exec 2: I quit.

And me too. I quit. Until someone can show the receipts for how Nintendo has benefitted from NOT selling products. Not speculation or innuendo, but tangible proof that shows that this was Nintendo's marketing strategy. Or that this strategy would have even been effective in this case.

Anecdote (not proof): I couldn't buy a Wii at launch. Nintendo did it to create demand.

Fact: Nintendo produced more units of the Wii for launch than any console in history at that point.

Show me proof that there was a warehouse where they were holding back produced systems. Or a strategic plan to limit the manufacturing speed (adding high extra cost per unit). Because for a manufactured scarcity one of these things would need to happen.

Explain to me how severely underproducing the NES classic benefited anyone other than scalpers.

Explain how having no units on shelves for the biggest shopping season of the year is a path to financial success.

Why do I keep getting sucked into these threads..
 
NPD reported a 14% increase in NES Classic sales from November.

That puts it at around 225K in December. November had 196K.

So in two months Nintendo has shipped less than 500K NES Classics to the US.

Is that artificial shortage or just incompetence?

Either way it's pretty bad.
 
Nvidia and the X1 line around has been around for quite sometime, and they use it for thier shield and shield TV devices. Do you honestly believe that this is cause by nVidia, IR camera or the rumble solution?

Wait are you are claiming that there are already a shortage of Switches? You may onto something I haven't seen any in the stores in my area.
 
Yeah no company will do that. Who would buy from them after that. Why take the heat for some other companies fucked up forcasting or logistics?

Right. Like I said I don't know if this is even a problem that needs solving. I'm just saying that I don't necessarily know if you can expect a company to overship a product -- particularly at launch -- for no other reason than ensuring there's no scarcity for scalpers to capitalize on. I don't think a large window of preorders is necessarily the answer anyway. I think in some people's minds the answer to this problem is you open up preorders around 6-12 months out, cut them off at like 3-4 months out, and that's the number you produce. And I think that's an oversimplification that doesn't really solve the problem.

What if regular consumers sour on the product before launch. What if scalpers en masse decide there's no profit to be made and bail. Also, what about people that don't preorder? Are they SOL? I thought we wanted to ensure that everyone who wanted one could get one.

I don't know. I've seen a number of products sell out at launch. Some of those are Nintendo products, sure. But many of them aren't. I'm not trying to say that Nintendo has the sharpest minds in the biz when it comes to forecasting. I just feel like there are plenty of reasons that range from sympathetic to critical that can explain this that don't involve them deliberately lowballing manufacturing orders to explain these scenarios. I don't know if 2 million Switches is the right quantity or not. But after the Wii U it's not hard for me to see that they'd err on the side of caution in terms of launch shipment quantities. And that number doesn't strike me as preposterously low for a non-holiday launch.
 
Osiris you got shredded in this thread lol. Boogs. Anyway, some GAFers have pointed out this topic has been discussed ad nauseum.

I think it is curious you use the word 'fabricated' in terms of the shortage, but then offer it as a question to discuss, it seems a little bit baiting.

Does it hurt N to have hardware shortages, yes, it would seem so when it sells out in a few hours after launching. For as much as people are whining about it it sure is hard to find.

I do not think they fabricate their shortage, I think they do not have a firm grasp of the worldwide market and changing tastes of gamers and their audience - they really never had.
 
NPD reported a 14% increase in NES Classic sales from November.

That puts it at around 225K in December. November had 196K.

So in two months Nintendo has shipped less than 500K NES Classics to the US.

Is that artificial shortage or just incompetence?

Either way it's pretty bad.

Its a niche item that plays decade old games. 500k is more than anyone will expect when there are various upcoming bigger games on newer platforms.
 
Nintendo ain't Sony or Apple or Samsung, they sell videogames only; it would be extremely risky to flood the market with dozens of millions of a certain product for them. They have to maximize the profits by allowing the lowest possible risk, which is what a company of such size should do. That's it

this post truth shit really is nauseating
 
I hear this is still happening with the SNES.

Nintendo is sitting on literally loads of them when scalpers and resellers are just sticking them on Ebay making big profits when Nintendo can make tens of thousands a day. The fact they're doing this is distorting the prices we pay as gamers. Bloody Nintendo.
 
Osiris you got shredded in this thread lol. Boogs. Anyway, some GAFers have pointed out this topic has been discussed ad nauseum.

I think it is curious you use the word 'fabricated' in terms of the shortage, but then offer it as a question to discuss, it seems a little bit baiting.

Does it hurt N to have hardware shortages, yes, it would seem so when it sells out in a few hours after launching. For as much as people are whining about it it sure is hard to find.

I do not think they fabricate their shortage, I think they do not have a firm grasp of the worldwide market and changing tastes of gamers and their audience - they really never had.

Agree. They seriously need to get a new market research team. I don't think the Nintendo shortages are "fabricated". They are more so incompetence.

It is time that they address these shortcomings though.
 
I hear this is still happening with the SNES.

Nintendo is sitting on literally loads of them when scalpers and resellers are just sticking them on Ebay making big profits when Nintendo can make tens of thousands a day. The fact they're doing this is distorting the prices we pay as gamers. Bloody Nintendo.

I heard that they have 200,000 mint shrinkwrapped copies of Earthbound just sitting in a Seattle warehouse, waiting for the right moment.
 
Things that are really popular sell out, and things that aren't don't?
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It's more that anything that isn't a massively embarrassing failure sells out and has huge shortages.

The people who are screwing this up have jobs while others who are actually competent are scraping by on unemployment. I'm not really sure why you're defending this.

Preorders were in and out of stock on Amazon and Gamestop for three days. That is more than sufficiently.

There are also reports of preorders for wave two going live as well. Nintendo is doing a much better job than any Console preorder I have ever heard of.

I don't think 3 days of preorders for a system launch is even remotely sufficient. People are hired and paid money to accurately estimate these things, leaving money on the table when there's no logical reason they couldn't have just released it later means these people are screwing up.

If they are continuing to make more product available that might change things but with most of thier consoles, amiibo and NES mini all having this issue if they deal with a healthy demand properly it wil be a change of pace for them.
 
You realize that Point Codes have to be generated in a secure environment and are not created on the fly when you buy them right?

No, I didn't. I don't claim any inside knowledge of Nintendo's virtual manufacturing or security process.

However, in my career I have worked with large financial institutions to manage permissioning systems for currency exchange markets and transactions. Broadly speaking, these involve creation of secure tokens for each stage of each transaction. The overall process is time-critical, secure, supports many thousands of transactions per second and compliant to financial regulations.

There is no need to create a finite number of tokens in advance - unless you are deliberately engineering limitations into your process.

Regardless, having a prepared message in the software to report lack of virtual stock to the consumer is evidence of premeditation.
 
The fabricated scarcity is a conspiracy theory. Wii was sold out because it was the damn Wii, the NES Mini because you can't mass produce something like that with a lucky guess. All of these things, combined with Nintendo's known stupidity, are more than enough to produce a scarcity.
Remember the Wii U? It was everywhere.
 
The reality is that Nintendo is not a company on the scale of Apple or even Sony. They have to balance their factory orders with what they think they will realistically sell in a given time frame. If their predictions are wrong, they will have shortages.

I think they really dropped the ball with Amiibo, but I think with the NES Mini it really was just that they underestimated demand.
The truth is even Apple struggles to satisfy launch demand many times. Currently AirPods have a 6 week waiting time. New iPhones are commonly hard to get for the first couple of months in some countries, etc. The Apple Watch had a waiting time and was unavailable to buy from stores, etc.

That's just how successful launches go. There are months of buildup to a high initial demand spike that doesn't pay to increase production rate for (or sometimes it's not possible at all) because as demand normalizes later you are left with a overly large and overly costly production line that will cost money to scale back.

Same reason why it's not worth for some online products (site, game, whatever) to increase server capacity to satisfy a demand peak that will normalize later. You will be left with too many servers for what you'd need normally.
 
Is Nintendo responsible for the "fabricated shortages" of PSVR and PS4 Pro as well? Maybe they have passed the disease to Sony?

Are there actually supposed to be shortages of these? I bought my PSVR a month and a half ago by walking into a Best Buy and purchasing one of the 7 units they had in stock. They had Pros in stock too but I don't recall how many.
 
It seems like they are rushing the console to be within the fiscal year. Judging by the available games and features like online, streaming, and apps not being finalized til Fall
 
Sigh, here we go again with this.
At least they covered their ass announcing previously that the shipment for Switch is 2 mln.

But with a lot of these Nintendo products it often just comes across as a conservative underestimation of demand. Like, what was the master plan for the NES Classic? To drive up demand for the Switch which they also intended to deliberately undership? I don't know. I feel like people often ascribe nefarious motivations when it's unclear how these marketing ploys are going to actually pay off. The white board seemingly looks like this to me.

1.) We deliberately ship out too few units.
2.) We watch as demand skyrockets.
3.) ??????????
4.) Profit!

What's phase 3 in this master plan?

Phase 3 is probably reading GAF's "masterplan" while missing thousands (or, in the case of NES Classic, likely hundreds of thousands) of sales.
 
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