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Strategies & Market Trends : VOLTAIRE'S PORCH-MODERATED -- Ignore unavailable to you. Want to Upgrade?

To: Dealer who wrote (5433)	10/4/2000 9:17:44 AM
From: Dealer	Read Replies (1) \| Respond to of 65232

RMBS--You'll have to wait a little longer for PlayStation 2 October 04, 2000 12:00 AM PT by Matt Berger It may be the most sought-after toy since the Cabbage Patch Kid. Just as hordes of moms played tug o' war over curly brown-haired dolls in the early 1980s, those hunting for Sony's (SNE) much anticipated PlayStation 2 video game console may duke it out in long lines come launch day. But for PlayStation 2 fans, the hunt has also extended online. "At the end of the day, really, it's just a nice Atari," says video game enthusiast Matt Sager, who spent the early part of the week scouring the Web to get his hands on a console. "But you do want to be the first kid on the block with one." The 128-bit PlayStation 2 -- a DVD-ready, high-performance video game console priced at $299 -- has North American faithful salivating. Many fans agree that Sony's Graphic Synthesizer -- the chip responsible for bringing to life the pulsating muscles and beads of sweat on Sony's animated characters -- is worth the price tag, and the wait. PlayStation 2 was launched in Japan on March 6 and has so far sold more than 3 million machines. Sony has yet to even launch an advertisement for PlayStation 2 in North America, but its mythology has preceded it. Now the company is in a predicament: It is unable to meet the expected demand of customers. "It comes back to the classic gaming industry pitfall of overhyping and underdelivering," says P.J. McNealy, a senior analyst with the Gartner Group. "And Sony walked right into it." Shorting deliveries Sony said last week that it would fail to meet its original estimates of distributing 1 million PlayStation 2 game consoles on Oct. 26, the North American launch date. The announcement only intensified the console's allure. Because of a shortage in components, Sony will halve the number of units it ships on the launch date from 1 million to 500,000. The company said it will make up for expected consumer demand by shipping 100,000 consoles each week thereafter, ultimately sending 1.3 million consoles out to market by Dec. 25. Sony still said it expects to meet its original estimate of 3 million consoles shipped in North America and 10 million worldwide by the end of the fiscal year in March. Pent-up demand Despite attempts to appeal to customers, many in the industry are predicting that Sony's concession may not satisfy consumer demand. But then, by some estimates, even 1 million machines might not have satisfied consumer demand. Counterbalancing the bad news with good news, Sony also announced Sept. 27 that it would nearly double the number of game titles to 26 that will be available by the Oct. 26 launch. "I can tell you, there's a lot of people who will have software by Christmas and a console by March," McNealy says.