It’s not just a game

  • Tuesday, November 13, 2001 9:00pm
  • Business

Associated Press

NEW YORK — Let the console game wars begin.

With the much anticipated Microsoft Xbox due in stores Thursday, followed by Nintendo’s GameCube three days later, this holiday season is looking to become a hard-core gamer’s dream.

In a slumping economy, the nation’s retailers are counting on the new consoles to drive overall traffic into their stores and hoping a sizzling video game market will fuel holiday sales.

The two hot new entries — their near simultaneous launch a first for the $20 billion video-game industry — enter a free-for-all competition for consumer dollars with the reigning leader, Sony Corp.’s PlayStation2.

Microsoft and Nintendo hope to sell more than a million consoles each this holiday, and event then there may not be enough to go around for everyone who wants an Xbox or GameCube.

"It’s one of the few situations for holiday where demand will far exceed supply," said Kurt Barnard, a retail consultant. "For those who want one, you are going to have to get up very early."

Brian Nugent, a 22-year-old game addict from Hackensack, N.J., tried and failed to preorder an Xbox online.

"At first, I wasn’t sure what I wanted, but now I’m going for Xbox first," he said.

Nugent still plans to buy GameCube at a later date, once the game portfolio is broadened.

Retailers are carefully trying to avoid the consumer frustration and lost sales of 13 months ago, when Sony ended up halving its original PlayStation2 allotment, leaving many stores in a tough spot.

"Merchants are trying to strike a balance between creating hype and meeting customer demand," said P.J. McNealy, senior analyst at Gartner G2.

Some retailers, such as Toys R Us, have done very little pre-selling so as not to disappoint walk-in customers, said company president John Eyler.

Retailers have also trained sales staff on the differences among the three consoles and worked to get some test-drive consoles from manufacturers for consumer sampling.

The consoles target a varied crowd.

The core customer base for the $199 GameCube is the under-20 crowd, and the majority of its games at launch are kid-friendly. Meanwhile, Xbox and PlayStation2, each $299, seek to attract players 18 to 34 years old. Xbox is the only one among the three consoles with a built-in hard drive and a plug for high-speed Internet access. Those features are external add-ons in the PlayStation2.

The PlayStation2, which has shipped more than 20 million units worldwide, was aimed at so-called early technology adopters and now seeks to broaden its reach, marketing down to age 13, said Sony spokeswoman Molly Smith.

Demand is already surging on the Web for the two new consoles.

Toysrus.com and Kmart’s Bluelight.com have in recent weeks done advanced online sales of GameCube and Xbox, selling out within minutes. Neither company would disclose sales numbers. And hundreds of units of both consoles already are listed for sale on the eBay online auction house.

Nintendo, which originally set the GameCube launch for Nov. 8, postponed it to ensure 700,000 machines in the initial shipment and 1.1 million by year’s end, the company says.

Microsoft announced in September a one-week delay of the Xbox’s U.S. release. It won’t say how many units will be available Thursday.

Previously, the company said it would ship 600,000 to 800,000 machines for the original launch. Instead, the company aims to sell 1 million to 1.5 million by year’s-end, said John O’Rourke, director of Xbox sales and marketing.

Xbox had been plagued with talk of production problems, but O’Rourke said the company was on track.

Meanwhile, Sony is ramping up its PlayStation2 production, with the goal of having 30 million units worldwide — one-third of them in North America — by the end of March, Smith said.

PlayStation2 has about 175 game titles. Xbox will have about 15 to 20 available games at launch, while Nintendo GameCube will have about 15 games at launch.

Copyright ©2001 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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