Moksha
12-14-2007, 11:17 AM
http://www.nytimes.com/2007/12/14/technology/14wii.html
A Year Later, the Same Scene: Long Lines for the Elusive Wii
By MATT RICHTEL
Published: December 14, 2007
SAN FRANCISCO — Linda Beattie is trying desperately to pay Nintendo $250, but the company is not cooperating.
Two weeks ago, Ms. Beattie went to a video game retailer in the Bay Area in search of a Wii, Nintendo’s intensely popular video game machine. She timed her visit to correspond with the arrival of a U.P.S. truck that she had heard would be making its regular stop at the store, hoping it might deliver some consoles. She was out of luck.
So Ms. Beattie, 44, a permit expediter and not a stalker by trade, followed the truck to the next store, where it did drop off a handful of Wiis. She bought one, but store policy would not let her buy a second for a friend, so she quickly called him.
“He came from another game store that he was staking out,” Ms. Beattie said. “He got there two minutes too late to buy the last one.”
Shoppers across the country have similar stories. With the Wii, Nintendo has created a phenomenon that recalls crazes of Christmases past: Cabbage Patch dolls, Furby, Tickle Me Elmo. But in this case it is happening for a second consecutive holiday season. Nintendo has been unable to keep up with demand, costing it hundreds of millions of dollars in potential sales.
The Wii, with an unusual remote control that players wave to manipulate action on the screen, has attracted a broad, unconventional following — from young children to mothers and even the elderly. It has put to shame the frenzy over another much-hyped gadget, the iPhone, which prompted long lines at its debut in June but was readily available on store shelves the next day.
The demand for the console has prompted creative buying strategies, early-morning camp outs and recrimination against Nintendo for failing to produce enough machines a full year after the product’s release.
Jim Silver, editor in chief of Toy Wishes magazine and an industry analyst for 24 years, said it was unusual for an in-demand product to remain so hard to find for so long. The must-have toys of other holiday seasons, like Furby, stayed popular into a second year but became easily available.
“It’s pretty amazing,” Mr. Silver said. “By a year later with hot items, inventory usually catches up.”
The Wii is more expensive than those other toys — $250 — and is attracting not just eager-to-please parents but also adults like Ms. Beattie who want it just for themselves. “I know 6-year-olds that love it and 50-year-olds that love it,” Mr. Silver said.
The unsated demand is costing Nintendo more than face. Estimates from industry analysts and retailers indicate that the company, which is based in Kyoto, Japan, is giving up $1 billion or more in sales in the ever-important holiday retail season, not including sales of games for those unbuilt consoles.
“It’s staggering,” said James Lin, senior analyst at the MDB Capital Group in Santa Monica, Calif., who estimates that Nintendo is leaving $1.3 billion on the table. “They could easily sell double what they’re selling.”
Between the Wii’s debut last November and this Sept. 30, Nintendo sold 13.1 million consoles. It ships 1.8 million a month worldwide — a third of those to North America — up from one million a month earlier this year.
When it comes to its planning, Nintendo says it has not done anything wrong.
“We don’t feel like we’ve made any mistakes,” said George Harrison, senior vice president for marketing at Nintendo of America.
He said there was a shortage because the company must plan its production schedule five months ahead, and projecting future demand is difficult. He added that there had been a worldwide shortage of disk drives that had hurt Nintendo as well as makers of many other devices.
“It’s a good problem to have,” Mr. Harrison said of the demand, but he acknowledged that there could be a downside. “We do worry about not satisfying consumers and that they will drift to a competitor’s system.”
At least one of those competitors is pleased with Nintendo’s supply problems.
“I’m happy that the Wii seems to be running out of hardware,” Howard Stringer, chief executive of Sony, said at a news conference in Tokyo this week. He noted that in November, the PlayStation 3 from Sony outsold the Wii in Japan for the first time.
Sony and Microsoft, which sells the Xbox 360, have both been caught off guard by the popularity of Nintendo’s console, which is less powerful and complex than their machines. The Sony and Microsoft consoles are widely available, while buyers tend to wipe out supplies of the Wii in a hurry.
Nintendo sold 981,000 Wiis in the United States in November, its best month yet, while Microsoft sold 770,000 Xbox 360s, and Sony sold 466,000 PlayStation 3 consoles, the market research firm NPD Group said Thursday.
hich receives daily shipments, shoppers line up on the sidewalk every morning for their shot at buying a Wii. There is a vibrant secondary market, with scalpers reselling consoles in store parking lots and online.
And while some people say they will keep searching for a Wii, others are giving up.
“I’m frustrated and I’m not going to try anymore,” said Betty Sapien, a San Francisco homemaker, who recently visited a handful of stores, including Best Buy and GameStop, to buy a system for her 9-year-old daughter. “They should have it well supplied. They know it’s going to be a big Christmas present, and it’s been a year” since it went on sale, she said.
Another shopper, Yvette Marchand, a Bay Area elementary school teacher, said, “I’m not proud of this, spending two hours running from store to store.” She spoke as she was standing last week outside of a GameStop. She said she had been to several stores, like Best Buy, where she arrived at 7 a.m. on a Sunday — too late to get a console, because others had lined up at 5 a.m.
“I’ve also been to Target,” she said, but when she asked for a Wii, she felt like the employees were mocking her. “I’ve received the smirks and the laughs.”
The GameStop chain, which accounts for around 23 percent of video game sales in the United States, said it could double or triple its Wii sales if the shelves in its 3,800 North American stores were fully stocked.
Bob McKenzie, senior vice president for merchandising at GameStop, said the company had stopped telling its stores when to expect their weekly Wii shipments. When word gets out about a delivery date, he said, “then people start doing crazy things, like putting up pup tents.”
In front of some retailers like Best Buy, where people have lined up to buy a Wii, the lucky few who manage to get one offer to resell them at a premium to those too far back in the line.
Colin Sebastian, an industry analyst with Lazard Capital Markets, said that on eBay, around 86,000 had been offered for sale since Dec. 4, with the average selling price about $320, 28 percent higher than the retail price.
Industry analysts suspect that Nintendo is intentionally keeping the supply low to maintain a buzz. If so, they say, the company risks permanently losing customers, because gift givers might not buy a machine in the new year.
“Nintendo is afraid that if it makes too many Wii, the boom may crest too quickly,” said Masayuki Otani, an analyst at Maruwa Securities in Tokyo. “It doesn’t want to satisfy all demand right away.”
But working in Nintendo’s favor is the fact that it has succeeded in further broadening a video game market that had already begun to expand beyond teenage boys and 20-something men.
Ms. Beattie, the truck chaser, said she and her friends, all in or near their 40s, have made the Wii a central part of their social time.
“We used to play poker,” she said. “Now we have Wii parties.” Because she’s self-employed, Ms. Beattie has continued to hunt for Wiis for her friends who have less flexibility at work: “They can’t leave their job when the U.P.S. truck comes.”
A Year Later, the Same Scene: Long Lines for the Elusive Wii
By MATT RICHTEL
Published: December 14, 2007
SAN FRANCISCO — Linda Beattie is trying desperately to pay Nintendo $250, but the company is not cooperating.
Two weeks ago, Ms. Beattie went to a video game retailer in the Bay Area in search of a Wii, Nintendo’s intensely popular video game machine. She timed her visit to correspond with the arrival of a U.P.S. truck that she had heard would be making its regular stop at the store, hoping it might deliver some consoles. She was out of luck.
So Ms. Beattie, 44, a permit expediter and not a stalker by trade, followed the truck to the next store, where it did drop off a handful of Wiis. She bought one, but store policy would not let her buy a second for a friend, so she quickly called him.
“He came from another game store that he was staking out,” Ms. Beattie said. “He got there two minutes too late to buy the last one.”
Shoppers across the country have similar stories. With the Wii, Nintendo has created a phenomenon that recalls crazes of Christmases past: Cabbage Patch dolls, Furby, Tickle Me Elmo. But in this case it is happening for a second consecutive holiday season. Nintendo has been unable to keep up with demand, costing it hundreds of millions of dollars in potential sales.
The Wii, with an unusual remote control that players wave to manipulate action on the screen, has attracted a broad, unconventional following — from young children to mothers and even the elderly. It has put to shame the frenzy over another much-hyped gadget, the iPhone, which prompted long lines at its debut in June but was readily available on store shelves the next day.
The demand for the console has prompted creative buying strategies, early-morning camp outs and recrimination against Nintendo for failing to produce enough machines a full year after the product’s release.
Jim Silver, editor in chief of Toy Wishes magazine and an industry analyst for 24 years, said it was unusual for an in-demand product to remain so hard to find for so long. The must-have toys of other holiday seasons, like Furby, stayed popular into a second year but became easily available.
“It’s pretty amazing,” Mr. Silver said. “By a year later with hot items, inventory usually catches up.”
The Wii is more expensive than those other toys — $250 — and is attracting not just eager-to-please parents but also adults like Ms. Beattie who want it just for themselves. “I know 6-year-olds that love it and 50-year-olds that love it,” Mr. Silver said.
The unsated demand is costing Nintendo more than face. Estimates from industry analysts and retailers indicate that the company, which is based in Kyoto, Japan, is giving up $1 billion or more in sales in the ever-important holiday retail season, not including sales of games for those unbuilt consoles.
“It’s staggering,” said James Lin, senior analyst at the MDB Capital Group in Santa Monica, Calif., who estimates that Nintendo is leaving $1.3 billion on the table. “They could easily sell double what they’re selling.”
Between the Wii’s debut last November and this Sept. 30, Nintendo sold 13.1 million consoles. It ships 1.8 million a month worldwide — a third of those to North America — up from one million a month earlier this year.
When it comes to its planning, Nintendo says it has not done anything wrong.
“We don’t feel like we’ve made any mistakes,” said George Harrison, senior vice president for marketing at Nintendo of America.
He said there was a shortage because the company must plan its production schedule five months ahead, and projecting future demand is difficult. He added that there had been a worldwide shortage of disk drives that had hurt Nintendo as well as makers of many other devices.
“It’s a good problem to have,” Mr. Harrison said of the demand, but he acknowledged that there could be a downside. “We do worry about not satisfying consumers and that they will drift to a competitor’s system.”
At least one of those competitors is pleased with Nintendo’s supply problems.
“I’m happy that the Wii seems to be running out of hardware,” Howard Stringer, chief executive of Sony, said at a news conference in Tokyo this week. He noted that in November, the PlayStation 3 from Sony outsold the Wii in Japan for the first time.
Sony and Microsoft, which sells the Xbox 360, have both been caught off guard by the popularity of Nintendo’s console, which is less powerful and complex than their machines. The Sony and Microsoft consoles are widely available, while buyers tend to wipe out supplies of the Wii in a hurry.
Nintendo sold 981,000 Wiis in the United States in November, its best month yet, while Microsoft sold 770,000 Xbox 360s, and Sony sold 466,000 PlayStation 3 consoles, the market research firm NPD Group said Thursday.
hich receives daily shipments, shoppers line up on the sidewalk every morning for their shot at buying a Wii. There is a vibrant secondary market, with scalpers reselling consoles in store parking lots and online.
And while some people say they will keep searching for a Wii, others are giving up.
“I’m frustrated and I’m not going to try anymore,” said Betty Sapien, a San Francisco homemaker, who recently visited a handful of stores, including Best Buy and GameStop, to buy a system for her 9-year-old daughter. “They should have it well supplied. They know it’s going to be a big Christmas present, and it’s been a year” since it went on sale, she said.
Another shopper, Yvette Marchand, a Bay Area elementary school teacher, said, “I’m not proud of this, spending two hours running from store to store.” She spoke as she was standing last week outside of a GameStop. She said she had been to several stores, like Best Buy, where she arrived at 7 a.m. on a Sunday — too late to get a console, because others had lined up at 5 a.m.
“I’ve also been to Target,” she said, but when she asked for a Wii, she felt like the employees were mocking her. “I’ve received the smirks and the laughs.”
The GameStop chain, which accounts for around 23 percent of video game sales in the United States, said it could double or triple its Wii sales if the shelves in its 3,800 North American stores were fully stocked.
Bob McKenzie, senior vice president for merchandising at GameStop, said the company had stopped telling its stores when to expect their weekly Wii shipments. When word gets out about a delivery date, he said, “then people start doing crazy things, like putting up pup tents.”
In front of some retailers like Best Buy, where people have lined up to buy a Wii, the lucky few who manage to get one offer to resell them at a premium to those too far back in the line.
Colin Sebastian, an industry analyst with Lazard Capital Markets, said that on eBay, around 86,000 had been offered for sale since Dec. 4, with the average selling price about $320, 28 percent higher than the retail price.
Industry analysts suspect that Nintendo is intentionally keeping the supply low to maintain a buzz. If so, they say, the company risks permanently losing customers, because gift givers might not buy a machine in the new year.
“Nintendo is afraid that if it makes too many Wii, the boom may crest too quickly,” said Masayuki Otani, an analyst at Maruwa Securities in Tokyo. “It doesn’t want to satisfy all demand right away.”
But working in Nintendo’s favor is the fact that it has succeeded in further broadening a video game market that had already begun to expand beyond teenage boys and 20-something men.
Ms. Beattie, the truck chaser, said she and her friends, all in or near their 40s, have made the Wii a central part of their social time.
“We used to play poker,” she said. “Now we have Wii parties.” Because she’s self-employed, Ms. Beattie has continued to hunt for Wiis for her friends who have less flexibility at work: “They can’t leave their job when the U.P.S. truck comes.”