supply-and-demand
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Sony: PS4 demand is challenging European supply
The PlayStation 4 is in high demand for the second holiday season in a row, according to Sony Computer Entertainment Europe CEO Andrew House. Without offering specific sales numbers, House told Reuters that the console is potentially "going to be quite inventory challenged." Shipments for the PS4 reached 13.5 million consoles as of the end of October. "I'm not going to say you won't be able to find a PlayStation 4," House added. "I think it's going to be kind of hand to mouth in terms of that market." The CEO noted that sales for the system in December were in line with Sony's projections, though it was a "tougher" month thanks to the $50 holiday price cut by its main competitor in the United States, Microsoft's Xbox One. While its gaming division is thriving, Sony upped its loss forecast to $2 billion in September due to struggling smartphone sales and opted to not renew its FIFA sponsorship at the beginning of this month to spend more money on structural reforms. [Image: Sony]
Mac Pro shipping window pushed back to March
In what's becoming an unfortunate trend for newly released products, it seems that Apple is having trouble keeping up with demand for the newly released Mac Pro. I suppose, though, that not being able to manufacture a product fast enough to keep up with consumer demand is a problem that most other companies would love to have. If you take a look at Apple's online store, you'll notice that the shipping window for the Mac Pro has been pushed back to March. Previously, the shipping estimate for Apple's new speed demon was February. This past December, Apple issued a statement to Forbes addressing the supply/demand imbalance. "Demand for the all new Mac Pro is great and it will take time before supply catches up with demand," an Apple spokesman said. You might recall that Apple's revamped iMac also experienced supply shortages for the first few months after it was released in late 2012.
iPhone 5s reportedly outselling the iPhone 5c by two to one
In the months leading up to the iPhone 5s and 5c unveiling, there were no shortage of analysts quick to declare that the iPhone had peaked. Everyone who wanted an iPhone, these analysts claimed, most likely already had one. Consequently, the narrative went, Apple's days of impressive iPhone growth were a thing of the past. Of course, reality told a much different story. During launch weekend, Apple sold 9 million new iPhones, setting a launch weekend record in the process. While Apple doesn't break down sales figures on a model by model basis, a new report from Consumer Intelligence Research Partners (CIRP) relays that the iPhone 5s is outselling the 5c by a factor of two to one. All Things D reports: According to CIRP's survey of consumers who purchased Apple's latest iPhones during the last days of September, the 5s accounted for 64 percent of total iPhone sales following its launch that month. Meanwhile, the the 5c accounted for 27 percent, with the legacy iPhone 4S making up the remaining 9 percent. So not only is the 5s outselling the 5c, it's outselling it more than two to one. This is good news for Apple on a number of fronts. First, Apple likely enjoys healthier margins on the 5s model, so the more of those they can sell the better. Second, it's proof positive that as long as Apple continues to deliver innovative new iPhone models, the masses will willingly and gladly fork over their hard earned money for a first-rate smartphone experience. Indeed, we're a few weeks out from the iPhone 5s launch and the device is still in short supply. While some handset manufacturers can't seem to give their devices away, Apple is still struggling to manufacture enough devices to keep up with demand.
Apple asks suppliers to increase gold iPhone 5s production
When rumors that Apple was planning to release a gold-colored iPhone began trickling in a few weeks ago, it was greeted with a lot of skepticism. Understandably, many felt that a gold iPhone would be gaudy, ostentatious and downright obnoxious. In truth, the aesthetic of the gold-colored iPhone 5s is much more subtle, and dare I say, elegant. Consumers have taken notice as well, with reports that the device is already in extremely short supply. Indeed, demand for the gold iPhone 5s is so great that Apple has reportedly reached out to its suppliers to if they can increase production by 33 percent. The Wall Street Journal reports: Apple has asked its suppliers to increase production of the gold-colored iPhone 5S by an additional one-third after seeing strong demand, people familiar with the situation said. It isn't clear whether there are currently supply constraints manufacturing the new iPhone. As it stands now, Apple's online store indicates that the gold iPhone 5s won't be ready to ship until October. In contrast, both the silver and "space gray" iPhone 5s models will be ready for shipment in seven to 10 days.
The Art of Wushu: Winning in market PvP
Last time on the Art of Wushu, I promised I would write on how to sell production crafts. Crafting is a big deal in Age of Wushu, so it seemed like a reasonable topic to cover. However, I realized doing so would probably be a mistake. Why? If you followed my advice from two weeks ago, congratulations. You probably noticed a huge nosedive in a few markets: hemp, ramie, iron, and mint all took a huge hit. It's a bit flattering to see how I can write a post on what to sell and readers like you guys take it to heart, flooding the market with supply and crashing the value of these commodities. If I gave advice on production crafting, the same thing would happen. Instead, this week I'm going to talk about real market strategy. Pointing out things that sell doesn't help you if the market takes a nose-dive. Understanding supply and demand curves, market equilibrium, and the importance of market diversity are all long-term tools that will help you regardless of what you're selling.
Do we need a cross-realm Auction House?
I live on a dying server. It's not quite dead, but it's slowly withering away. I'm not sure what happened, exactly, but I have an idea of when -- at the beginning of Wrath of the Lich King, Dalaran was packed. By the end of the expansion, there were far fewer people running around. Orgrimmar in Cataclysm was a quiet place to be, and in Mists, the Horde shrine is populated by a few handful of players. As I said, I don't know what happened, but for some reason the masses that were on my server when I rolled there in Burning Crusade have all but evaporated. On the one hand, it makes Pandaria a pretty quiet, idyllic place to be. There's hardly any competition for rare spawns, and you don't really have to compete with anyone for quest mobs or ore nodes or herbs, either. There's hardly any drama on the server, by and large because there really aren't enough people around to generate it. Sure, there are a few jerks, but it seems like everyone on the realm is generally relaxed and well-behaved -- as long as you stay out of Trade Chat. On the other hand, it makes trying to buy or sell anything on the auction house an absolute nightmare.
iPad 2 shipping time hits 24 hours for the first time
For the first time since the iPad 2 began selling on March 11, 2011, the shipping time for the iconic tablet is 24 hours. That's right -- you can order an iPad 2 right now with the assurance that it be shipped from the factory within one day. It will take a few days longer for it to actually arrive at your doorstep, but at least there are no delays in production now. This is a sure sign that Apple's production of the iPad 2 has finally reached an equilibrium with demand. During the Apple Q3 2011 Results Call last month, Apple Chief Operating Officer Tim Cook noted that the company was nearing that critical balance of supply and demand, and it appears that early production issues have been resolved. Shortly after the iPad 2 release, TUAW reported that shipping times had slipped out to 4 - 5 weeks. By the end of April, those times had decreased to the 1 - 2 week level. Since then, improvements in the yield of critical components have helped the situation. If the future iPad 3 proves to be as popular as its predecessors, I'm sure we'll see similar shortages for 4 to 5 months, so be sure to order early and often.
Gold Capped: How patch 4.2 broke the auction house
Every week, WoW Insider brings you Gold Capped, in which Fox Van Allen and Basil "Euripides" Berntsen aim to show you how to make money on the auction house. Capitalism is the best, and communism is for dirty, Soviet-sympathizing hippies. If you disagree, Email Fox or twitter him @foxvanallen so you can be added to the CIA's "list." On June 24, 2010, I woke up at 4 a.m. I grabbed some coffee, got into my car with my roommates, and went to the Cambridgeside Galleria mall to stand in a ridiculously long line. The goal: to get an Apple iPhone 4. It was the latest and greatest thing, and we all had to have it. A very similar dynamic is happening right now in the World of Warcraft. There are a slew of new-for-patch-4.2 items currently available on the auction house. New BOE gear from Firelands. New tailoring and leatherworking patterns. New blacksmithing plans. Living Embers. New PVP gear. They're all -- at least in theory -- high-demand items. After all, given players' insatiable lust for better gear, customers should be lining up around the (virtual) block to be buying all this stuff. But on many servers, they're not. The demand is clearly there, but markets are struggling to function. What happened? Why did the market break? What are players doing wrong? And how exactly are you supposed to play the market with these new-for-4.2 items?
T-Mobile G2x gets a $50 price bump, still no stock in sight
It looks like the G2x saga isn't over quite yet; after first disappearing from store shelves due to quality concerns "high demand," the dual-core Android smartphone is getting a slight price hike from T-Mobile. As of May 27th, the out-of-stock Froyo handset decided it was worth an extra Grant (quite the presumptuous fellow, no?), dialing in with a new price of $249 after rebate. An internal screenshot describes the price hop as a reaction to inventory constraints. The supposed effects of supply and demand aside, this price adjustment feels a little shaky amid reports of botched WiFi handoffs, overheating, light leakage and reboot issues. With any luck, the G2x will return to store shelves sporting a worry-free update to Gingerbread; but if you aren't counting on it, you can still snag one at Amazon to the tune of $99. Oh, and look: plenty in stock, too!
EVE Evolved: Emergence in the sandbox
We often hear about the amazing things players get up to in EVE Online, from full-scale political wars and massive heists to collaborative business ventures and high-profile kills. While we can all enjoy these tales of high-powered exploits from afar, they can be difficult to relate to the actual game experience. Most of us will never be the puppet master pulling the strings of alliance warfare or the mastermind of some great theft, but we don't have to be. Smaller examples of emergent and opportunistic gameplay exist all over EVE in the daily play of thousands of individuals. I've always thought of EVE less as a game and more as a giant social sandbox with spaceships -- a story about what people do when left alone in each other's company. Players naturally take on roles for which they have a strong aptitude, crafting completely new gameplay styles for themselves in the process. The entrepreneurs among us spy opportunities never imagined by the game's developers, tech-savvy individuals sell web-services, and artists craft propaganda for recruitment or a war on their enemy's morale. Countless players carve their own game out of the EVE universe, and there's no reason you can't be one of them. In this week's EVE Evolved, I look at some of the unique gameplay experiences players have engineered for themselves over the years and the community that makes EVE what it is.
World Bank report finds selling virtual goods in games more profitable than 'real' economy
A report commissioned by the World Bank's infoDev unit has cast fresh light on one of the more fascinating aspects of our brave new interconnected world: the virtual economy. The "third-party gaming services industry" -- where wealthy but impatient players have someone else grind away at online games for them in exchange for monetary reward -- is one of the focal points of the study, chiefly owing to it having generated revenues in the region of $3 billion in 2009 and now serving as the primary source of income for an estimated 100,000 young folks, primarily in countries like China and Vietnam. What's encouraging about these findings is that most of the revenue from such transactions ends up in the country where the virtual value is produced, which contrasts starkly with some of the more traditional international markets, such as that for coffee beans, where the study estimates only $5.5 billion of the $70 billion annual market value ever makes it back to the producing country. The research also takes an intriguing look at the emerging phenomenon of microwork, which consists of having unskilled workers doing the web's version of menial work -- checking images, transcribing bits of text, bumping up Facebook Likes (naughty!), etc. -- and could also lead to more employment opportunities for people in poorer nations. To get better acquainted with the details, check the links below or click past the break.
Apple could agree to component price hike to secure touchscreens
Contending with seemingly insatiable demand for its new iPad 2, Apple is pondering paying higher prices for touch panel components, according to a report from DigiTimes on Wednesday. Manufacturers in Taiwan claim Apple is more open to certain price hikes during negotiations as the California company tries to secure a sufficient supply of components for its popular touchscreen products. Higher component prices, in the short term, will shrink Apple's gross margins on three of its hottest selling products: the iPad, iPhone and iPod touch. But securing adequate availability of touch panels should help the company relieve some of the constraints in its global supply chain. Such a deal would also put pressure on other consumer electronics companies to pay more for the components they need to build competing tablet computers and smartphones. Apple currently faces incredible pressure from consumers and shareholders to address bottlenecks in the supply chain for its successful families of touch panel devices. Lead times for the new iPad 2 ballooned to 4–5 weeks in its first few days on the US market, and the tablet goes on sale to a broader, global market this Friday. Apple reportedly expects to ship 40 million iPads in 2011. The company is also expected to launch its next generation iPhone later this year. The earthquake and tsunami that struck Japan earlier this month further fueled concerns over possible touch panel supply shortages. According to AppleInsider, a recent report suggested Foxconn, Apple's manufacturing partner, has only two or three weeks' worth of touch panels stockpiled. If the situation in Japan doesn't improve, Foxconn could deplete its stock of touch panel components. Despite these concerns, DigiTimes believes Apple is well positioned to weather a shortage of touch panels. Apple has already booked an estimated 60 percent of the world's touch panel output capacity. As the global market leader in touchscreen devices, Apple will continue to control the lion's share of the world's touch panel supply and enjoy lower component pricing than its competition. "Supply for touch panel[s]...will be more smooth for Apple," concluded DigiTimes. [via AppleInsider]
OpenPandora begins 'private' sales, fast-track your open-source gaming handheld for an extra $150
What with all the excitement about Sony's quad-core handheld and Nintendo's autostereoscopic screen, we have to say, we nearly forgot about the open-source Pandora handheld slowly but assuredly shipping from the UK. Well, we've got some bittersweet news to share, and here it goes: you can now purchase a Pandora for $500, and have it ship within a week. What's bitter about that? Because normally you pay $350 and get put on the pre-order waiting list. That extra $150 sounds like quite the surcharge, but it's an option if you simply can't wait for your number to come up, and OpenPandora chief Craig Rothwell tweets that some portion of those monies will help support the project. Still, those extra units have to come from somewhere, and if you've been standing in line for months, we imagine you won't happy to hear that some rich kid can just swoop in and buy your Pandora out from under you without a care in the world.
EVE Evolved: ISK sinks and faucets
In EVE Online's player-run economy, the flow of ISK is a vital concept. While there are many ways to make ISK in EVE, most of them only move it around from one player to another. When you mine ore and sell it on the market, for example, the mining process doesn't introduce any new ISK to the game. Only a few game mechanics can be called ISK faucets, as the game mechanics actually create ISK from thin air. Similarly, the ISK sink mechanics destroy ISK or remove it from the game in some manner. To the individual player, the difference between something being an ISK faucet or not is largely immaterial. When you sell something on the market for a few million ISK, or get the insurance payout on a lost ship, it doesn't really matter to you where that ISK came from. Where the concept really matters is in discussions on inflation and how the game chooses to reward us in PvE. Are ISK bounties and rewards always a good idea, or could their over-use eventually lead to runaway inflation? In this week's EVE Evolved, I look at the various ways in which ISK flows in and out of EVE Online, and why we should care about inflation.
EVE Evolved: EVE Online's not-so-free market
One of the most talked-about features of EVE Online is its player-run economy. Due to over 330,000 players living on one server, the markets have reached a critical mass where the laws of economics play out in a very effective manner. When there's a demand for something, no matter how obscure the item or low the demand, you can be sure there are dozens or hundreds of pilots trying their best to supply it. The in-game economy mirrors real-life economic situations so closely that CCP even hired a dedicated economist to analyse the market and advise CCP of any problems that arise. EVE's economy is often referred to as a pure free market, but that isn't technically true. At its heart, EVE is still a game designed and implemented by a team of developers. All MMO economies require some degree of control and intervention for the game to remain playable. In EVE, this comes in the form of careful balance of supply and demand via changes to game mechanics and drop rates. There are also a number of more direct passive influences on the market, such as NPC market orders and insurance. In this economic article, I look at a few of the influences that constrain free-market economics in EVE.
Intel Arrandale shortages leading to premium prices, potential product delays
Now this might explain Apple's curious choice to not upgrade the 13-inch MacBook Pro to a Core 2010 CPU. Yahoo! News is reporting shortages of the more budget-minded Core i3 and i5 laptop processors launched by Intel this January, which has led to chip buyers outbidding each other to the point of paying 20 percent premiums on contract prices. That's according to US chip distributor Converge, while research firm CLSA Asia-Pacific Markets estimates that product rollouts could be delayed by up to three months as a result. What has Intel got to say for itself? "We don't comment on speculation, what I can say is that we are pleased with the strong product demand for our laptop platforms." Well sure, you get paid more on a per-CPU basis, why wouldn't you be pleased? On a more serious note, during Intel's latest earnings call both Paul Otellini and CFO Stacy Smith expressed their surprise at the vast demand for their 32nm products, with Smith noting that their production of 32nm chips is the fastest ramping process in the company's history. So there's not really any villainy afoot here, just good old demand catching supply napping.
GameStop on Wii: 'Three years later, we finally have enough'
Three years and countless lives lost later, it appears that Nintendo's Wii has finally found equilibrium in the epic battle between supply and demand. GameStop SVP of Merchandising Bob McKenzie, speaking with embedded reporters from Gamasutra, expresses the company finally has enough inventory on the shelf, with at least a couple weeks worth of supply.As for software, McKenzie sees EA Sports Active being another hit for the console, stating that the pawnshop conglomerate was surprised by the popularity of Wii Fit. Although this talk of Wii sales equilibrium sounds lovely in March, that doesn't guarantee it'll hold true once the holidays come around. But, at least, the concept of balance in the Wii supply chain is a tangible idea after all these years.
December Wii sales held back by supply shortages
While moving 2.15 million units in a single month is nothing to jeer at, analysts are expressing their disappointment in the December sales figures of the Nintendo Wii. Jesse Divnich from the Electronic Entertainment Design and Research firm calculates that over 4 million Wiis could have found themselves placed beneath trees or crudely tucked into stockings -- had "supply and demand been in equilibrium." He also praises Nintendo for almost singlehandedly protecting the industry from the full brunt of the recession at the end of the year -- a victory we usually credit to our soul-crushing addiction to video games.
The science of farming nodes and playing the market
How to make money in your MMO of choice; this is probably one of the most popular topics among players who want the best gear. Should you raid for rare boss drops? Should you buy low and sell high in the auction house? Should you farm for crafting supplies? Of course, each game's economy is different, but personal preference should dictate what you ultimately decide and how you wish to spend your time. Over at Kill Ten Rats, they've written a great article on the phenomenon of item pricing in MMOs. The example is centered around the economy of Lord of the Rings Online and how you can allow certain people to inflate auction house prices beyond belief, to ultimately lower the item's price for others. It's an interesting take on an MMOs version of supply and demand, which isn't really even based on supply or demand, but the perceived version of either.
Making/Money: Economic Equilibrium is MIA
When I first started playing MMOs I was in college. I'd bounced from major to major but ultimately settled on Economics (from a starting point of Medieval and Renaissance Studies - how'd that happen?). Like other economists in games like EverQuest and Ultima Online, I was thrilled to find a lively economy and interested to apply classical economic models in the study of it. The most basic of these models is the typical supply and demand curve. Any economic model starts with price and quantity. The higher the price, the more suppliers want to sell but the less consumers want to buy. As the price decreases, more consumers are interested in purchasing, but fewer suppliers are able to produce profitably. In theory, there is a magical level in the middle where supply and demand meet. That is equilibrium (see graph). What I have since found, which is furiously debated by other economists in the field, is that the typical supply and demand curves do not fit well with the economies of most MMORPGs these days. Depending on the game, add-ons used, and availability of additional market data, there may be sort of invisible caps to the price, and thereby the quantities, of goods traded. Furthermore, auction house fees and vendor sales act much in the same way as taxes or subsidies in real world economies.
