Microsoft Admits 90 Day Target Will Be Missed

According to an article by British business paper the Financial Times, Microsoft has admitted that it will not reach its 90 day target for the Xbox 360 of 2.75 to 3 million consoles shipped. Analysts suggest that only 1.3 million units have been shipped worldwide by the end of 2005, with shortages expected to continue everywhere but Japan in January and beyond. As suggested at CES last week, the company is now focusing on a target of 4.5 million to 5.5 million consoles by the end of the fiscal year in June. The company has primarily blamed manufacturing problems for the missed target, having recently announced that a third manufacturing plant will be brought online to meet demand. "Nothing's perfect - you've got a complex piece of hardware that includes 1,700 different parts. Every now and again the line will slow down because something's happened and there'll be a component that didn't make it that morning,” commented corporate vice president Peter Moore. Although the Japanese launch has certainly been disappointing, the missed target does seem to be one solely of supply at the moment with demand for the new console extremely strong in the West and particularly in the U.S. The real concern for Microsoft will be the shortened amount of time the supply problems give for the Xbox 360 to create a significant lead in user base before the launch of the PlayStation 3. Peter Moore has previously spoken of plans to sell 10 million consoles within the first twelve to sixteen months of the Xbox 360's launch, a target that is now more dependent on Xbox 360 stock and the launch date of Sony’s console than any other issues.