The week before Thanksgiving, University senior Ryan LasCano missed his classes Wednesday afternoon and all day Thursday. He didn’t mind, though, because in the process he pocketed $950 cash.
LasCano was one of three University students hired by fellow student Mattias Otto to stand in line in front of the Springfield Best Buy electronics store in order to purchase a Sony PlayStation 3 on its Nov. 17 release date, then hand it over to Otto so he could sell it on eBay for a profit.
“It was fun, and it was actually a lot easier than I thought,” LasCano said. “People brought TVs and (XBox) 360s, so we were just playing and watching movies the entire time.”
LasCano and his cousin Edgar Gallardo were each given $660 to pay for the 60-gigabyte console and a controller, then were paid $950 for their services after delivering the product Friday morning, he said.
Otto was only one of many treating the new console as an investment. eBay reported Friday that nearly 15,000 PS3s were sold through the Web site between Nov. 17 and Nov. 24, the first eight days after the console’s release.
The machines that retail for about $600 were selling at an average price of $1,186, the report said.
Both the Circuit City and Best Buy electronics stores in Springfield completely sold out of the consoles before noon on the Nov. 17 release date, associates said.
“They were gone by 8:00 that morning,” said Steven Stepp, a media specialist at Best Buy.
Stepp said Best Buy had a total of 26 of the gaming systems, which were released in both a $499 20-gigabyte format and a $599 60-gigabyte machine. He said he was aware that many people were planning on selling them for a profit online, but what they do with the PS3 is out of the stores’ control.
“Whatever their business with it is their business,” Stepp said. “Our job is just to give it to them.”
Springfield Circuit City associate Eric Champion said his store only supplied eight PS3s on the release date, and eager gamers were camped out two days before the system release.
“When they first lined up we went outside and asked how many people were keeping it,” he said. “The first five raised their hands and the other three said they weren’t.” Champion added that the Springfield store’s employees checked on the sellers’ progress.
“That day we watched eBay, and they were going for about $2300,” Champion said.
Neither local store has received a second shipment since the initial release date, and a nation-wide scarcity has made the PS3 more valuable as a resellable commodity.
Of the 26 people who were on the list to get one of the game systems kept by the store, LasCano said only two of them told him they had planned to keep it. The rationalization is easy because of low supply and high demand, he said.
“There’s millions of people in the world that want them, and there’s only a couple hundred thousand out,” he said. “People, instead of having it, know they can make a lot of money selling it.”
Otto, who originally intended to purchase as many as 60 units, formed his own company to carry out the operation and hired an attorney to write a contract for his employees to sign that guaranteed they would return the console after purchasing it.
The original agreement was for only $300, LasCano said, but he and Gallardo twice requested more money for their services to arrive at the final payment.
“It was kind of just a trust thing,” he said. “We didn’t have to sign another contract. We just trusted him to pay us if he trusted us to do it.”
Otto came through too, collecting a total profit of $3,500 for the operation.
Even with the money he made, Otto said he was unhappy with the result and wanted to carry it out on a much larger scale.
“Everything failed horribly,” he said in an e-mail. “I was planning on getting 60 units and I only got 6. There was a rumor that I was running a scam, which scared people off.”
Otto, who fronted much of the business capital with an inheritance, said most of the profit came from a man in Texas who spent $10,000 to purchase five of the six consoles, 60 games, 15 controllers and a few cables.
For LasCano, waiting was most of the work. He and Gallardo arrived at the store on Nov. 15, two days before the scheduled release. The pair received the equivalent of company benefits as soon as they got in line.
“Mattias (Otto) at that point came and brought us sleeping bags with just cash – $1,320 cash, all this Taco Bell food to eat and a tent,” he said.
Forty hours in line later, the two had their salaries in hand.
“By the end of the day Friday morning, we went to his house, gave him the PlayStation 3 with the receipt and the game, and right there on the spot he gave us $950 cash each,” LasCano said.
The Nintendo Wii, released two days after the PS3, is selling for considerably less on eBay, but the rival console enjoyed a similar anticipation and popularity in local stores.
“It was the same for that one,” Champion said. “They were gone pretty much as soon as we opened the door.”
Stepp said the same thing has happened with previously released game systems like the XBox 360 or the PlayStation 2. Both were extremely hard to come by when they were first released and saw large markups online, he said.
LasCano said several people outside Best Buy lined up to get their hands on a PS3, but were turned away when the store sold out.
“There were people that waited almost as long as I did and didn’t get one,” he said.
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