End of the line for Xbox?

by Johnny Minkley
With a short supply of Xbox continuing to hit all territories, Microsoft Corp. on Tuesday admitted it had so far failed to solve the issue – which has been hampering the format since well before Christmas of last year.

In a statement, the Redmond giant said: “Consumer demand is exceeding supply right now,” but maintained it was “working with partners to rectify the situation and to satiate consumer need.”

However, MCV has learned that Microsoft representatives have been engaged in talks with major UK retailers over the past fortnight, presenting a bleaker picture of the shortage crisis.

One major High Street retailer said: “Microsoft’s sales team made it clear to us that, while we could expect Xbox in dribs and drabs, the situation was not going to improve dramatically.

“We were given the impression that, while Microsoft would do its best to help, there just weren’t going to be enough Xboxes around to satisfy ongoing demand.

“We’ll hopefully be able to satisfy orders on an ongoing basis, but don’t expect more that that. Microsoft may be trying to play the situation down officially, but its sales team is telling us something quite different.”

THOMPSON: “The situation is not that bad”

Keen to pour cold water on suggestions that the Xbox shortage crisis was far worse than Microsoft was prepared to admit officially, UK Xbox boss Neil Thompson spoke exclusively to MCV to respond to the claims.

“The situation is that we’re still not meeting demand – but in four-to-six weeks the situation will be much healthier,” Thompson (pictured) insisted. Asked exactly how many units Microsoft would be able to supply, Thompson could not offer specifics, but added: “We will be meeting more of the demand.”

Referring to the meetings reportedly held with retail, he said: “I’ve been in many of these meetings myself and what I’ve said is that we are in tight supply due to a bigger Christmas period than we anticipated.”

However, the UK boss did admit he couldn’t guarantee all demand would be met: “Can I meet everyone’s demands? It’s tough to say, but we are bringing in as many units as we can – and we’re manufacturing more Xboxes as I speak.”

…but 1 million Xbox 2s by Xmas

Industry nose-tappers have long suggested that the underlying reason for the Xbox shortage is Microsoft paving the way for its next home console. And despite continued denials from the company, MCV understands that key publishing partners have already been briefed in some detail.

“We have been told to expect roughly one million Xbox 2s in Europe alone by the end of the year, and 1.5 million by the end of March,” a senior source at a major US publisher told MCV. “Microsoft is making a huge commitment, no question.”

The source also suggested that Xbox 2 would not be backwards-compatible with current-gen software, fuelling speculation that many publishers were now deliberately holding back key releases to ensure they are made ‘next-gen ready’ to insure against ongoing shortages.

Meanwhile, Xbox supremo J Allard (right) revealed a tantalising glimpse of the next Xbox, in an exclusive interview with MCV at GDC earlier this month.

The Xbox 2 experience will come in regional flavours to suit different territories, with Allard even hinting at the possibility of customisable hardware.

Asked how a one-shot mass-production Xbox 2 sat with his GDC keynote vision of personalisation, he said: "We have ways. We have ideas. Look at cell phones. You can have snap-on faceplates, you can change the skin and the batteries, and you can change the ringtones. I think we need to have a global foundation, and then personalise within region.”

Allard said that a hard disc – unconfirmed for Xbox 2 – wouldn't necessarily be needed. "My cell phone is incredibly personalized without a hard drive," he said. "One reason is because of the great connection to the service."


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