The Math of Undertracking

[amirnetz]

ioi said:

Lol? So 2m in the channel is unreasonable but 1.5m is fine amirnetz? Hmmm

I have no issue with your scrutiny but I have already told you that your assumptions are wrong.

OK. I think I figured out where the numbers started to go wrong and trouble me. This is actually pretty interesting if you care about the math.

It is the beginning of June 2008 and VGC is reporting the Xbox Europian LTD sales to stand on 5.2M. 
 

Console	X360
UK	2,237,946
France	745,226
Germany	500,487
Spain	351,309
Italy	423,488
Scandinavia	389,518
Other Europe	638,598

5.2M was a clear VGC overtrack. Microsoft is telling us now that the EMEA LTD shipments by June were actually only 5M. Since some of the units were in the channel (~0.4M-0.5M) then the actual units sold to customers were really about 4.5M. This is significanty less than the 5.2M tracked by VGC.

In following months (July- Sep) VGC actually undertracked the Xbox causing me to raise the red flag in my October posting (finding the discrepency between Microsoft shipments and VGC tracking). As it happens, the summer undertracking by VGC actually compensated the prior overtracking until June and got it to a more accurate point at the end of September.

At the end of September VGC puts Microsoft on 21.27M units LTD WW. Microsoft reported 22.5M in LTD shipments for the same period. This means that VGC puts the channel inventory on 1.25M. That's 2.5 months of inventory based on the July-Aug monthly average. This would seem to be a pretty high number. Remember that the 360 also had this very sudden surge following the price cut at the end of September that would have depleted the inventories. Still VGC propose 2.5 months of inventory left.

Anyway - that's where the problem begins. The WW sell-though at the end of September should have been higher, probably by about 300K. In October VGC undertracked the 360 in the US by about 100K (compared to NPD) and these 100K + 300K from before would explain the gap between my math and ioi.

So yes - I do believe that the math suggests that the sell through for the 360 should be about 300K-500K higher. But as suggested above by SpartanFX- this will clear up when we get the official shipping numbers from Microsoft in January (or if they will be nice to continue to provide on going shipment numbers during December).