Wednesday, November 7, 2007

Greed Is Good

The cold weather is making me nostalgic for last year and the opening salvo in the console wars. In a word, it was a complete clusterfuck. If you recall, hundreds of thousands of like-minded dickheads slept outside their local Best Buy/Circuit City or whatever waiting for a PlayStation 3 or a Wii. At the time, pre-orders were going for as much as $2000, and there was little doubt this played a part in the ensuing violence. It seems unlikely electronics retailers and toy stores will allow this scene to repeat itself in another four years. I have a proposal.

Until supply can meet demand and the market finds a comfortable foothold, I suggest the next great console be launched exclusively on eBay. Think about it. The first PlayStation 3 consoles (20GB and 60GB, $500 and $600 respectively) cost somewhere between $900 and $1000 to manufacture. The only people making money off the PS3 in its first few months of life were the scalpers online. It took some time before manufacturing caught up and people realized there weren't enough good games to make it worthwhile. One could argue that's still the case.

What if Sony auctioned off the first few batches of consoles until manufacturing caught up and demand could be met? Why should they let anyone else get all that money? You could argue that game sales are more important in the long run, or that Blu-Ray needed to gain a foothold before HD-DVD gained traction. But, how many PS3 owners have over $300 in games at this point? Is anyone taking HD-DVD seriously? That X-Box 360 add-on drive reminds me of .ZIP disks.

Nintendo isn't off the hook for violations against capitalism, either. They're playing in a whole different league this year and they're making money on every piece of hardware they put on the shelves. I still think they're missing out. The Wii is still going for around $400 on eBay and Fils-Aime says they're not going to catch up to demand until 2008. Imagine the despair on parents' faces when they realize they're about to disappoint their children for the second Christmas in a row. I hope they like crying.


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