PlayStation 3 supply falls short of demand

  • Associated Press
  • Friday, November 17, 2006 9:00pm
  • Business

NEW YORK – Tight supplies of Sony Corp.’s PlayStation 3 game console led to rowdiness at several stores when it went on sale Friday and tempted new owners to sell their consoles for a profit to those who hadn’t braved the throngs of sharp-elbowed shoppers.

In Putnam, Conn., two gunmen tried to rob people lined up for the console and shot one who refused to surrender his money. Michael Penkala, 21, of Webster, Mass., was wounded in the chest and shoulder. He was in stable condition Friday with injuries not believed to be life threatening, according to Connecticut State Police.

In Fresno, Calif., police arrested two people and threatened to use stun guns to break up a crowd that rushed a store and trampled people in the parking lot.

To get the attention of an unruly crowd of about 350 people, police fired a paint ball at the ground outside a Target store in Henrico, Va.

Sergio Deynes, 26, who had camped out at a Best Buy in New York since Monday to get his PS3, said the people with him at the front of the line were “beautiful.”

“It was the people in the back who were desperate who messed things up for a lot of us,” Deynes said.

The market for second-hand PS3s flourished: Deynes’ cousin, who camped with him, immediately sold his PS3 for $2,500.

On eBay, the two PS3 models, which cost $500 and $600 in the stores, were selling for between $1,000 and $3,000.

“Hearing all these numbers definitely made me very conflicted,” Deynes said, but “thinking of all that I went through, I’m not getting rid of this thing … Last night the rain messed up our tents and we got soaked and we had to sleep in the freezing cold.”

In Los Altos, Calif., Justin Kwong was looking at an unopened PlayStation 3 box and finding that the money outweighed the pleasure of being one of the first with a PS3. He bought it Friday morning after three nights in a sleeping bag outside the Mountain View Best Buy.

“I’ve seen what they’re going for … so I’m thinking probably of selling, because it’s such a large profit margin,” he said.

Meanwhile, technology research company iSuppli Corp. reported taking apart a $600 console, and finding that it probably costs Sony $840 to make.

ISuppli notes that it’s common for manufacturers to take a loss on the hardware, calculating that they’ll make it up with game sales. Also, component costs should come down in the future.

“Still, the size of Sony’s loss per unit is remarkable, even for the video-game console business,” iSuppli said.

The company called the console “an engineering masterpiece,” more akin to expensive corporate hardware than a consumer-level computer.

In Philadelphia, Glenn Giersdorf had his PS3 up and running but didn’t see it as being an immediate step up from Microsoft Corp.’s Xbox 360 console, which went on sale a year ago. He said a new Xbox title, “Gears of War,” actually looked a little bit better than the equivalent PS3 game, “Resistance: Fall of Man.”

This is natural, Giersdorf said, as games that are available for the launch of a console generally aren’t as good as games that come out later, when developers have learned to take advantage of all the features of the hardware.

“By 2008, Sony is going to be showing that the console has more ability and power than the 360,” said Giersdorf, 35.

Giersdorf is also getting a Wii, ostensibly for his 4-year-old son.

“That’s how I’m kind of selling it to his mom,” Giersdorf said.

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