Microsoft, channel stuffing, and bad press ...

There's an interesting read over at Information Arbitrage about Microsoft, the Xbox 360 (including the recently announced Elite), and questionable retail and distribution practices.

It's a timely write-up, especially given Microsoft's PR abrasiveness in the face of the Elite's upcoming release (and Nintendo's success).

Fairly aggressive stuff:

'Microsoft is in trouble, and this ain't no joke. Vista is a disappointment. Search is weak. Xbox is under siege from the Wii. Paul Graham recently posted that "Microsoft is Dead."'

And, later:

"Bottom line: strong companies confident in their strategy and performance don't do these things. They don't have to. What kind of a message does this type of behavior send to the investor community and, more importantly, your customers? Weakness. Fear. Short-term thinking. Nothing that represents a positive signal for a better, brighter tomorrow."

The whole post is an interesting read, especially if you're unfamiliar with things like channel stuffing, and learning from the business past to avoid future mistakes.

It's also stokes a bunch of my pet peeve fires, because it touches on a bunch of them:

1. Falling into legacy models in a "modern" market -- Nearly fifteen years ago, when I was managing a pet shop, we were trained in the tactics and dangers of channel stuffing so we could protect ourselves and our Customers. What, the biggest software company in the world doesn't know the same stuff and more?
   
2. Cronyism -- Maybe not directly, per se, but there's some unneeded stroking of other financial / analyst blogs and articles in this post. Fawning is for deer. Or something.
   
3. Not the whole story -- Sure, it's a post about Microsoft. And the Sony PS3 and Nintendo Wii are mentioned briefly. However, this post doesn't mention Sony is as more guilty on the channel stuffing front, and the slew of other miss-steps (including the business side, loss margin per console, etc. It doesn't mention the possibility of artificial shortage of the Wii (according to GameStop; not so much according to Nintendo). And so on.

But other people are writing some of those latter articles, and Kotaku and Joystiq continue to be decent industry watchdogs, and maybe even Information Arbitrage will chime in on some of these other issues. An equivalent write-up (pro or critical) of Sony and Nintendo would be interesting companion pieces.

• Information Arbitrage: "Microsoft, Channel Stuffing and Desperation: Old Tricks for a New Era"