XBox Driving CE Sales

CE resellers claim that Microsoft’s XBox 360 has been a big hit with many consumers walking out the door with up to a $1000 worth of purchases in their hands.

According to the Australian newspaper Sales at Harvey Norman since last week’s midnight launch had been ahead of forecast. “We had some fairly high expectations and it exceeded our expectations. We’re more than happy,” said Paul English, the chain’s computers and communications business manager.

With Xbox 360 sales ahead of its own predictions, Microsoft ruled out any discounting of the Xbox 360 during 2006. “I can tell you that we’re not planning any price drops on Xbox 360 this year at all. The product doesn’t need it,” Microsoft entertainment and devices director David  McLean said. Early reports suggested an average Xbox 360 purchase price of $960, Mr McLean said. Games popular with early buyers included Call of Duty 2, Project Gotham

Racing 3 and Oblivion. Mr English said the $649 pro bundle had been the most popular, but shoppers were also notching up big sales of games and accessories. “Most people are walking out with three to four games, additional controllers and probably a battery pack for the controllers,” he said. Steve Wilson, managing

director of specialist games retailer Electronics Boutique, also reported strong sales. “We had pretty high expectations, and it was above them,” Mr Wilson said. “Most of the pre-orders were picked-up on the launch day,” he said.

Like Harvey Norman, EB had seen many buyers walk out with more than the Xbox package. “For each piece of hardware they’re buying three or four games or extra bits of hardware,” Mr Wilson said. Microsoft had predicted launch sales of $30 million to $40 million in consoles and games for the launch, saying it had between 35,000 and 45,000 Xbox 360 consoles on pre-order.

Both Harvey Norman and EB reported that pre-orders had almost completely sold. Mr McLean said anecdotal reports suggested most pre-orders were “out the door” and some outlets had sold out.

“I expected the product to sell through in about two weeks and it looks like it has sold through in about four days,” he said. Microsoft said last week’s launch accounted for the sale of about 10,000 units alone. “Without doubt, we’re ahead of our plan. We thought we were being very aggressive with what we put in this

market,” Mr McLean said. Microsoft rejected reports of widespread faults in the Xbox 360 that have circulated since its US launch in November.  There had been some faulty units, but the fault rate was well below the normal consumer electronics average of 3-5 per cent, Mr McLean said.