Hope there is no truth to this:
Analysts: Xbox could be behind schedule
August 14, 2001 12:14 PM ET
by Michelle Rushlo
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Microsoft's (MSFT) long-awaited video game console could be three to four weeks behind schedule, analysts said today.
Thomas Weisel Partners analysts Eric Ross and David Readerman said a flaw in Intel's (INTC) motherboard design for Xbox may set back the initial build schedule.
Don't panic
"This doesn't mean that Xbox will have a late delivery date. We note that our sources in the supply chain believe there is no reason to panic," they said in their report.
Ross and Readerman said they believe Microsoft can still meet its production targets, even with the delay. They also noted delays are common in the PC hardware business.
Microsoft is scheduled to release the Xbox with 600,000 to 800,000 units on Nov. 8; up to 1.5 million are to be built by the end of the year.
David Hufford, the public relations manager for Microsoft games, said the company remains on target for the launch and the year-end production goals.
Intel officials declined to comment, referring all questions to Microsoft.
Game makers vulnerable
A stumble out of the gates prior to the holidays probably wouldn't damage Microsoft much initially because most analysts believe the software giant will lose money on each unit it sells. It hopes to eventually make profits from in-house game development and royalty fees from other game makers.
But Sony's (SNE) delay in releasing PlayStation 2 last year demonstrated the kind of damage that can be done to video game makers, who depend on holiday sales.
Electronic Arts (ERTS), for example, posted an 8-cent-per-share loss in the fourth quarter of last year when PlayStation 2 consoles were in short supply and many players were losing interest in the aging PlayStation and Nintendo 64 systems.
Michelle Rushlo is a reporter at UpsideToday covering big-cap hardware and software companies. If you would like to submit a letter to the editor regarding this story, email online@upside.com. |
