Microsoft is expected to miss its Xbox 360 sales targets

Microsoft explains Xbox 360 shortages

Lack of capacity and shortage of components apparently

vnunet.com, 09 Jan 2006

Microsoft has cited components shortages and a lack of capacity as the cause of shortages of Xbox 360 consoles in the shops, the Financial Times reported today.

The admission comes as the software giant is widely expected to miss its target of 2.75 to three million consoles shipped in the 90 days since launch on 22 November.

Analysts estimate that 1.3 million consoles were shipped by the end of last year but warned that sales since the new year have been limited by shortages.

Microsoft announced at the Consumer Electronics Show in Las Vegas that 4.5 to 5.5 million units would be shipped by 1 July this year.

The software giant claimed that it now has a third contract manufacturer on stream, Celestica, along with Flextronics and Wistron.

Microsoft also admitted to production glitches. "This is a complex piece of hardware with 1,700 different parts," said a spokesman.

"Every now and again the line will slow down because something has happened and there will be a component that did not make it that morning."