ShareThisBy CLINT SWETT
Monday, November 13, 2006
Let the salivating begin.
Heading into the holiday shopping season, three electronics giants _ Microsoft Corp., Sony Corp. and Nintendo of America _ are launching long-awaited products this week.
Questions remain about how warmly Microsoft's Zune (pronounced Zoon), a $250 portable music player, will be received when it hits the market Tuesday and whether it can slow Apple's iPod juggernaut.
But analysts expect the two new video game systems by Sony and Nintendo to generate huge demand. Sony's PlayStation 3 should reach stores on Friday, priced at $500 or $600 per pop, while Nintendo's new $250 Wii (pronounced Wee) goes on sale Sunday.
"We'll sell through our supplies (of both consoles) quickly, probably in minutes," predicted Jim Babb, a spokesman for Circuit City, based in Richmond, Va.
In one indicator of demand, customers who have ordered the $600 version of Sony's PS3 are already receiving eBay bids of $1,900 or more for their game boxes.
For his part, Joe Kubalek, a 23-year-old college student in Provo, Utah, can't wait. "I have all of these on several Christmas wish lists," he said, adding that he's lined up a PS3 at a discounted price from a well-connected friend.
What's behind the frenzy? First, free-spending gamers are always eager to own the latest equipment, and the holiday shopping season stokes demand even further.
Second, anticipation among PlayStation loyalists has been building for nearly a year. Sony was expected to roll out the PS3 last spring, but technical glitches delayed its launch until now.
Finally, the consoles are expected to be scarce, at least for a few months. Sony says only 400,000 will be in U.S. stores this week and 1 million by the end of the year. In Japan last week, eager buyers formed long lines at stores, waiting to get their hands on the PSP's limited rollout there of 100,000 consoles.
Nintendo also is acknowledging the likelihood of shortages. While not providing specific numbers, Nintendo spokeswoman Allison Guillen said her company would have "thousands and thousands more" consoles available than Sony but likely not enough to satisfy demand. "We are expecting the Wii to sell out," she said. "We'll be replenishing them at retailers every few days, but those will sell out, too."
While frustrated consumers might wonder whether the shortages are deliberately engineered by companies to fuel more demand and buzz, Jupiter Research analyst Michael Gartenberg said that's not the case.
"In the first release of products, there are always supply constraints," Gartenberg said. "But there's nothing artificial. Sony wants to sell everything it can."
With their newest consoles, Sony and Nintendo are taking very different approaches to the market.
The Wii is a simpler machine and, at $250, far less expensive. Its most notable feature is a motion-sensitive controller that a user waves about like a wand to generate movements for the game's characters on a TV screen. In a football game, for instance, by using a throwing motion, the gamer can get his quarterback to whip a pass down field. In a game involving swordplay, a slashing motion would be used to slay an enemy.
That capability "is really redefining game play," said Jupiter's Gartenberg. "It's a really different gaming experience."
Many Wii titles have built-in tutorials to guide users through the game's intricacies, said Tom Samiljan, who writes a gadget blog for the Yahoo Tech Web site.
"The Wii is going for a mainstream audience," he said. "They are trying to get gamers back who feel alienated from the complicated controls" that current games require, he said. "The games today are such a long way from the kind that we used to pick up and play."
For its part, the PS3 continues the industry trend of packing game consoles with features designed to turn them into a living room entertainment hub.
In addition to Wi-Fi and Bluetooth capabilities, the $600 Sony machine has a 60 gigabyte hard drive, a powerful microprocessor and a Blu-ray disk drive that will play the latest generation of high-definition video disks. It also includes online multiplayer gaming capability, similar to its rival Microsoft Xbox 360, which hit store shelves last November.
Samiljan was particularly impressed with the high resolution he saw with two new games, which are best appreciated on a high-definition TV set. "The quality of the video is just beyond belief," he said. On a high-end HD television, "those games will look just brilliant."
While Nintendo and Sony duke it out in the gaming arena, Microsoft is preparing to battle Apple for a chunk of the portable music market. With an estimated 70 percent of the market for portable music players, Apple has wielded its high-end design and dazzling marketing to swat aside would-be rivals.
But Microsoft might eventually challenge that dominance, experts said. The long-awaited Zune is priced competitively with iPods and includes some features that iPods don't have. Among them: a large screen, an FM tuner and the ability to share some music wirelessly between two Zune players. By some estimates, Microsoft could sell as many as 500,000 Zunes this holiday season.
