PS3 Goes on Sale, but Supply, Tempers Run Short

Nov. 17, 2006 — -- A lot of people would probably say that Jacob Beilin is out of his mind. Beilin, a 20-year-old college student, skipped classes to camp outside a Best Buy store in New York City for his shot at the much-hyped next-generation PlayStation 3 video game console.

"They think I'm crazy," said Beilin, referring to his family. "What can I say? But I got two friends here with me, so we're all crazy, I guess."

If Beilin is crazy, then the illness is spreading. All over the country, gamers, parents, grandparents and at least a few opportunists snaked around the block to get their hands on the first Playstation 3s as stores began to sell them Friday.

Supplies ran short, and tempers did too. There were even some reports of criminals preying on waiting buyers.

In Putnam, Conn., police said two armed thugs tried to rob a line of people waiting for the PS3 early Friday -- and shot one man who refused to give up his money.

About 30 miles away in Manchester, Conn., another shopper was beaten and robbed of his new PlayStation 3 just minutes after he bought it, police said.

Most lines were reportedly peaceful. But many would-be buyers came away empty-handed.

Retailers, such as the video game megachain Gamestop, which also owns EB Games, announced they could meet only 60 percent of the preorders they've already sold.

But Gamestop isn't the only retailer experiencing shortages that hint that Sony was perhaps not completely honest about PlayStation 3 supply shortfalls, beyond what the company has said publicly. Though Sony was expected to ship only about 400,000 units in the first place, red flags have begun to pop up all over the place.

"We're barely going to have enough to cover presales and will not have any available for walk-in customers," said Kathleen Waugh, a spokeswoman for Toys "R" Us.

Shortages of video game consoles are nothing new; they are usually expected when a new system is released.

Just last year, when Microsoft's Xbox 360 launched, there were rampant reports of nationwide shortages, and those shortages coupled with extremely high demand helped make the Xbox 360 the must-have gift of the season for anyone who could find it.

"The console release cycle is unlike almost anything else in the consumer technology biz," said Ross Rubin, director of industry analysis for the NPD Group. "These products undergo a major revision once every five years or so, and the PlayStation has been the market leader for the previous couple of generations. So there are high expectations about what Sony is going to deliver."

It's hard to argue that gamers are not a hardcore bunch. But don't be fooled by the tents and sleeping bags lined up outside your local electronics store. Not all are camped out for a love of gaming. Some are in it for the money.

"Buy and sell. Gotta make the money to pay for some other stuff," said Greg White, one of about 25 people in line at a Best Buy in Brooklyn, Ohio.

Like some of the others in line with him and countless more across the country, White isn't interested in the latest games or cutting-edge graphics. He's more excited about the thousands he expects to get from selling the PS3 on eBay.

Some people weren't even trying to get a PlayStation 3 but knew the value of a space in line close to a store's front doors.

At a Circuit City in Schaumberg, Ind., Eric Arana and his wife offered to sell their spot for $2,000. They were number 43 in line.

"There's a big after market for these things that has sprung up on eBay over the last few years," Rubin said. To get the deal you're looking for, though, "you do need to have the stomach for fraud potential on eBay and be willing to possibly miss a meal or two."

For the lucky ones who managed to snag a preorder -- or managed to snag one on launch day -- there's a good chance they're spending a lot more than the $500 and $600 Sony is asking for the two PlayStation 3 models.

Many retailers have forced consumers to purchase "bundles," which include games and extra conrollers but are predetermined by the store. In some cases, stores have required customers to make huge, almost totally unrelated purchases just to preorder a PS3.

Last weekend, CompUSA ran a circular advertisement offering PlayStation 3 preorders to customers who purchase a Sony HDTV, 40 inches or larger, and its Web site won't allow anyone to place a PS3 order outside a bundle. The least-expensive TV that fits that bill at CompUSA is sold online for about $1,800. Want a PS3 for $2,300?

"It's supply and demand. The choice may be between paying $2,000 at retail and getting the big-screen TV or paying $2,000 on eBay and hoping the seller will get you a real product," said Rubin. "The level of consumer intensity about the product certainly helps fuel this kind of excitement and this level of demand, and certainly the degree of the shortage plays into it as well."

Privately, retailers and video game software makers have expressed frustration with the apparent lack of supply.

But gamers have a choice. Nintendo's revolutionary Wii is set to launch Nov. 19, and the company says the supply is plentiful.

Additional reporting by WEWS Cleveland, the Associated Press, and's Stephen Splane.

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