UK Hardware Production Woes Increase For Xbox

Issues revolving around stock problems with Microsoft's Xbox console have hit a peak this week, with UK retailers once again voicing their suspicions that Microsoft has purposefully stopped or severely slowed manufacture of the console. Concerns were raised earlier in the month in the UK that, unlike the situation with the PlayStation 2, stock issues from the Christmas period had still not been resolved. Similar concerns were then raised in the U.S. with multiple retailers admitting to little or no stock of the console, a situation which Microsoft answered by arguing that it is the public's demand that is keeping the Xbox off shelves. In the UK, though, retailers have been acting with more urgency, forcing Microsoft to issue another public statement this week that "Consumer demand is exceeding supply right now," and that Microsoft was "working with partners to rectify the situation and to satiate consumer need." According to British trade paper MCV, though, Microsoft representatives have allegedly been engaged in talks with UK retailers for the past fortnight, with one unnamed retailer apparently claiming: "Microsoft’s sales team made it clear to us that, while we could expect Xbox in dribs and drabs, the situation was not going to improve dramatically." "We’ll hopefully be able to satisfy orders on an ongoing basis, but don’t expect more than that. Microsoft may be trying to play the situation down officially, but its sales team is telling us something quite different." However, senior internal sources talking to Gamasutra are suggesting that Microsoft has, indeed, tacitly and drastically slowed down production of the console, in anticipation of the launch of the next generation Xbox format this year. Such is the cost of each console, with the company famously making a considerable loss on each unit sold, that the company has been eager to cease production as early as possible, in favor of the potentially more profitable next generation format. The company is unlikely ever to admit to this policy publicly, though, which may make it difficult to maintain positive PR until the new format’s launch - thought to be set for late fall this year.