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Microsoft to boost availability of Xbox

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Posted: Tuesday, March 21, 2006 10:28 am | Updated: 3:42 pm, Fri Oct 7, 2011.

SEATTLE - Microsoft Corp. said Tuesday that it will significantly ramp up the availability of its Xbox 360 video-game consoles, following production problems that have made the popular game systems difficult to find on store shelves.

Beginning this week, the Redmond software maker said it would distribute two to three times as many Xbox 360 consoles to retailers each week than it did before. The uptick comes as the company has added a third manufacturer, Celestica Inc., and brought component supplies up to full production levels.

In late January, Microsoft conceded that it suffered some production woes after the game system's late November launch, forcing the company to reduce slightly its original sales forecast for the first 90 days after the console's launch.

But the company has maintained that it is still on track to ship between 4.5 million and 5.5 million of the consoles by June 30, when its fiscal year ends.

The Xbox 360, the second version of Microsoft's video-game player, became a holiday must-have item, frustrating consumers who weren't able to get one.

However, the shortage became a boon to some entrepreneurs, who were able to hawk their systems on Web sites such as eBay Inc. for hundreds of dollars more than the original retail price.

Despite the frustrations associated with the shortage, Microsoft's early entry into the market could give it an advantage in its rivalry with market-leader Sony Corp., maker of the popular PlayStation. Sony said last week that its much-anticipated PlayStation 3 would now come out in November instead of this spring as previously thought.

Nintendo Co., maker of Game Boy machines, also is set to release its next-generation Revolution console later this year.

Microsoft said Tuesday that it plans to have 50 Xbox 360 games available through retailers by June and another 30 available via Xbox Live Arcade, part of the company's online gameplay service. The company currently has 26 games available through U.S. retailers and 19 through Xbox Live Arcade.

Currently, Microsoft loses money on each Xbox 360 it sells. The company wants to eventually break even on the hardware while making money on other things, such as the Xbox Live service.

Microsoft shares rose 19 cents to $28.08 in midday trading Tuesday on the Nasdaq Stock Market.

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