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Reader Comments (87)

Posted: Mar 20th 2008 3:46AM BurntMeatloaf said

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VidGuy: "'Lack of supply creates artificial demand' makes me laugh. Learn some economics."

It worked for oil in the 70's.

Whether artificial demand exists or not depends on whether people NEED the item in question. There's a difference between *needing* food at the supermarket and *wanting* a game console.
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Posted: Mar 19th 2008 12:29PM vidguy said

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Must we explain this again? Nintendo is not creating a shortage but rather refusing to invest in new production lines to increase their capacity. This is the smart business move considering the cost of investment and the fact that demand will eventually subside. If Nintendo gets more production lines to produce more consoles, they will likely end up losing money on the deal.

Similarly, Nintendo is making a profit on each console sold. Restricting supply only loses them potential revenue because Nintendo does not see any of the money made in the secondary market (Ebay, Craigslist, etc). If Nintendo were restricting supply, their shareholders would have to be mighty pissed. Considering the fact that Nintendo is producing and selling more consoles each month than its competitors, they are very unlikely to be voluntarily restricting supply.

Lastly, consider the possible business move that would be the most profitable for Nintendo: raise the Wii's MSRP until demand is balanced with supply. In this case, Nintendo would be maximizing profit while satisfying demand. Of course, raising the MSRP of a $250 console to, say, $450 isn't exactly consumer-friendly and Nintendo refuses to do this because of the value of consumer loyalty and future purchases.

Face it, the only reason there is a Wii shortage is because at USD$249.99 the Wii is a very attractive product for a large number of consumers. Supply is not excessively low; demand is just extraordinarily high.

Posted: Mar 19th 2008 12:47PM (Unverified) said

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No company in its right mind would allow shortages to last this long. If you can't keep up with demand, build another manufacturing plant, period. Economics 101, it's really that easy, and Nintendo would already have new assembly lines if they wanted to. Nintendo is aware of shortages, they in fact use that as a selling point but hasn't done a damn thing about it. Seems to me like they are deliberately creating shortages.
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Posted: Mar 19th 2008 12:48PM (Unverified) said

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I'm making a profit off each console sold...on ebay.
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Posted: Mar 19th 2008 12:52PM (Unverified) said

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qbix

They are creating new plants.... they start operating in April.

http://www.gamer.tm/news.php?id=2010&filtr=wii
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Posted: Mar 19th 2008 12:54PM vidguy said

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Your "Economic 101" should also include the time delay for new facilities, the cost of starting and shutting down new product lines, and the importance of maintaining profitability across the life of a product.

What people here seem to want is for Nintendo to produce and sell enough consoles to meet current demand. While that's a rational desire, it would be a seriously stupid business move. Nintendo can maintain the $250 price point longer if they don't meet current demand. They can maintain their current cost structure by refusing to start new production lines. They can continue to make a profit on each console sold. They can limit the magnitude of increases in bandwidth to their servers. They can project consistent earnings rather than riding a massive influx of cash in the next few months, for the next four years.

If a business followed your "Economics 101", they would quickly be bankrupt.
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Posted: Mar 19th 2008 12:59PM FrankTheCrank said

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What kills me is that Nintendo could raise the price of this thing by $25-$50 and people would still be buying them in droves.

I'm just happy I got one.
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Posted: Mar 19th 2008 1:11PM (Unverified) said

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Obviously Qbix hasn't actually attended Econ101.
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Posted: Mar 19th 2008 2:18PM (Unverified) said

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Great post, vidGuy. People who continually say they are 'creating a shortage' need to read your posts very closely. Nintendo is public company and has to answer to its stock holders and not us...well that is unless you own some of their stock ;-)
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Posted: Mar 19th 2008 12:34PM Mr Khan said

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Hmm. Rumor said that they would be upping production next month, I wonder if gamestop's accurate on this

Posted: Mar 19th 2008 12:35PM (Unverified) said

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Wow, what a bunch of bologna. This is just ridiculous already. WTF Nintendo, stop BULLSHITTING!

Posted: Mar 19th 2008 12:40PM Nigeria said

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Everytime I see your avatar I always think of "eeeee eee eeee"

I don't know why. The dude looks like a bear. A bear that thinks it's happy. Maybe that's why.
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Posted: Mar 19th 2008 2:02PM (Unverified) said

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Whaaaa? YOU, are making fun of MY avatar?!!

*Scoffs
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Posted: Mar 19th 2008 2:24PM (Unverified) said

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And how can he think he's happy?

His most used quote is

"Now I'm PISSED!!"


lulz
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Posted: Mar 19th 2008 12:48PM (Unverified) said

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Nintendo every month outsell both the PS3 and 360... for almost two years, it's been outselling both.

Why create a fake demand? They would be the only perjudicated.

Last year in april thet ramped up the production from 1 million to 1.8 million a month.

Now, at the end of this month, starting in April, they will increment the production again (maybe because they are going to start selling the Wii in Korea)... http://www.gamer.tm/news.php?id=2010&filtr=wii

Now, with this increment, they are going to sell more every month, and even more in the holidays...

And when the sales start to slow down, they can do one thing that both Sony and Microsoft have done, TWICE... a price cut.

And then different colors...

Nintendo is not going everywhere... the sales are real... people still go to stores at 6:00 am to make a line to get a Wii.

Posted: Mar 19th 2008 12:56PM (Unverified) said

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Yeah
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Posted: Mar 19th 2008 12:55PM (Unverified) said

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Everyone who complains of the shortages just wants a Wii but can find one, and for that they are very bitter. They are making 1.8 million units PER MONTH.

Posted: Mar 19th 2008 12:59PM dantebk said

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Six more months of shortages?

Does this have anything to do with Reggie seeing his shadow a couple days ago?

-Dante
http://www.gamestache.com/

Posted: Mar 19th 2008 1:05PM makattack said

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Heck, even in the distant future, Eric Cartman had trouble finding a Wii...

Posted: Mar 19th 2008 1:27PM Deck said

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Gamestop knows all! *FEAR*

Posted: Mar 19th 2008 2:02PM xgenius said

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Buying a Wii was the WORST gaming purchase I ever made. Only good times I have had with it are No More Heroes, RE4 and Galaxy. Everything else is either not my cup of tea (Smash Brothers) or for friggin babies. My advice to anyone still waiting, buy a PS3 or 360.. And if you are trying to get one for your kids, get them a PS2 instead. It has a much better library of games.

Posted: Mar 19th 2008 2:05PM vidguy said

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Everyone's different. The Wii was the best gaming purchase I've ever made and I've played it about twice as much as the 360 I spent more money on.
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Posted: Mar 19th 2008 2:39PM Crono141 said

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because metroid is for friggin babies.
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Posted: Mar 19th 2008 2:02PM (Unverified) said

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Count me in as another who has lost interest. Seriously, I have yet to actually see a Wii in any of the stores I frequent around here. Plenty of peripherals and games, but no consoles. It's funny, I remember the days not so very long ago (pre-PS2) where anyone could basically walk into a store anywhere and anytime and get the console they wanted. As much as I'd like to play a Wii, the ol' gut instinct is telling me it's not worth even half of what this continued shortage would suggest.

Posted: Mar 19th 2008 2:48PM Colossalhat said

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"What people here seem to want is for Nintendo to produce and sell enough consoles to meet current demand. While that's a rational desire, it would be a seriously stupid business move."

I thought that was the definition of an artificial shortage...

Posted: Mar 19th 2008 5:29PM vidguy said

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Well then you thought wrong. An artificial shortage is an intentional restriction of supply below capacity in order to raise the market price of a commodity. The idea is to sell less at a higher price, thereby creating larger profits.

Nintendo is not creating an artificial shortage for two reasons. One, they are producing at capacity. Even if you consider the refusal to (quickly) open new production lines, there's number two: Nintendo is not raising the price of the Wii.
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Posted: Mar 20th 2008 3:49AM BurntMeatloaf said

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They are not producing at capacity. They are producing at volume margin.
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Posted: Mar 19th 2008 2:52PM xgenius said

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Metroid isn't for babies, but I definitely thought the controls were bad. Better than the abortion that was Red Steel, but still not good enough for a FPS.

Posted: Mar 19th 2008 3:18PM (Unverified) said

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That's because it's an FPA.
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Posted: Mar 19th 2008 3:40PM Hoagie said

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'Lost interest' because you don't see Wiis on shelves? wtf?

1.8 million units a -month-.... That's like one fifth of the PS3s -total- install base (not meant as a bash). However simple the Wii may be in contrast to the 360 and PS3, it's still a sophisticated piece of electronics. They're not making birthday cakes here, it's not as simple as saying 'just make more'.

As for quality games, there's plenty. Alot more than the PS3 has imo, and just as many as the 360 did in the same point in it's life.


Posted: Mar 19th 2008 8:09PM Kingap said

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LIARS

I went to them back in mid january, asking them when their next wii shipment will be, and they told me february.

Meanwhile, here in NYC, the nintendo world store gets DAILY SHIPMENTS that are first come, first serve.

DAILY SHIPMENTS

Gamestop is going to kill the gaming industry.

Posted: Mar 19th 2008 11:42PM (Unverified) said

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What?

1. GameStop didn't have any.
2. GameStop said they wouldn't get any for a while.
3. The Nintendo World Store (aka not GameStop) had lots of them.

What part makes GameStop liars?
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Posted: Mar 20th 2008 12:36AM SoulBlade said

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Good points bro. One part stood out for me though:

"For me personally, I've never been a big fan of Nintendo's franchises, so they aren't something I usually pursue."

Now, these are some of the most critically acclaimed games in the history of the industry. You've had a lot of experience playing games, yet you do not like these particular ones. At least you can admit that they are quality titles, and Nintendo has produced a fair amount for the Wii at this point.

Not all hardcore gamers are rational when it comes to determining if a game is good. Many are way too elitist and fail to give games the chances they deserve. Likewise, many are attached to one particular genre, or one particular franchise and can not see the beauty outside of their personal preferences. Basically, it's very hard to meet an objective hardcore gamer - especially fanboys. You are not a fanboy, btw.

Posted: Mar 20th 2008 12:37AM SoulBlade said

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and that was meant to go under Shaggi's post on the first page. sweet.
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Posted: Mar 20th 2008 2:47AM ThornedVenom said

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THANK YOU BRAWL. =_+

Posted: Mar 20th 2008 7:24AM (Unverified) said

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There are a lot of logic challenged people on these boards. They're creating an artificial shortage by producing more units than they ever have before? WTF kind of sense is that suppose to make?

By that logic they also created artificial demand by limited production of nes, snes, n64, GC, and gameboy because they produced each of these systems in far smaller quantities per month than Wii. This would also apply to playstations, xbox's, and sega's consoles basically the entire game industry because no game systems has ever sold 1.8 million of month for over 6 months... it simply never happened before.

Posted: Apr 12th 2008 2:43PM hvnlysoldr said

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Those still harping on the artificial shortage conspiracy has to at least admit Nintendo is much smarter than them.

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