The launch of the new PlayStation 4 and Xbox One consoles last month has seen demand outstripping supply. With a lack of consoles, a gray market has blossomed on websites like eBay and Craigslist, with systems selling for hundreds of dollars over retail price.
Here we take a look inside that gray economy at some of the people buying and selling — and at the big headlines that this market has inadvertently created.
The Craigslist seller
For Steven Miori of Houston, picking up an Xbox One at launch represented a quick investment opportunity. “On release day, I figured all of the Xbox Ones would be sold out to people who waited in line all night,” he told me via email. “But when I went to Target around 11 a.m. that morning, they had two consoles left.”
Miori tried buying both, but the store would only sell him one. “After calling around town a little, I realized that by about noon that day everyone was sold out,” he said. “It was a no-risk purchase because Target has a 90-day return policy, so worst case scenario, if I didn’t sell it, I would just take it back.”
Miori originally planned to sell the console on eBay for $700 – a markup of $185 on the total (after tax) that he paid – but the 10 percent seller fee put him off. He ended up putting it on Craigslist for $640.
“I only got one call the first day,” said Miori. “A kid offering to trade me an iPhone 5S for it. I told him, ‘No, thanks.’
“I didn’t get another call on it for about five or six days and was getting a little discouraged and thought about lowering the price. But Thanksgiving Day, I got a call from a guy who offered $600 for it. We eventually agreed on a price of $620.
“I grabbed a friend and met him in front of a Starbucks. He was a nice guy and paid in cash, and we went our separate ways. [It was a] pretty easy way to make $100!”
One buyer caught up in the stock shortage was NASCAR Sprint Cup driver Scott Speed. He met a Craigslist seller in a gas station parking lot on the PlayStation 4’s release day to buy his console.
Speed posted a tweet while waiting, which read: “Waiting for my craigslist guy at the gas station…. Lmao first time I have ever done this.. Talk about awkward!!!! Lol.”
In the end, the deal went well.
“[It] ended up being super easy,” Speed told me via Twitter. “Just felt really weird and embarrassing,” he added, but said he wouldn’t hesitate to do it again.
Sales gone bad
The decision to trade in a public place is something all buyers and sellers should note, as not all transactions have gone as smoothly as Speed’s.
On Nov. 17, 25-year-old Emmanuel Johnson was shot and killed during what appears to be a PlayStation 4 sale that went wrong. The Orlando Sentinel reports that Johnson and an unnamed 23-year-old man were due to meet outside Orlando Police Headquarters to carry out the console sale but switched the meeting site. Both men were shot, Johnson fatally, in a subsequent exchange of gunfire at the rearranged venue.
Ikenna Uwakah, home from college for Thanksgiving weekend, was shot dead in San Francisco on Dec. 1 after agreeing to sell a PS4 console via an ad posted on photo-sharing site Instagram. Uwakah, who drove to the deal with his girlfriend, was then ambushed and shot in broad daylight. His killer took the device and fled, according to police reports.
Even sales that seemed to go without hitch have proved problematic. A man in Colorado Springs answered a Craigslist ad to buy a PlayStation 4 for his son. What he actually bought, from the sale conducted in a motel lobby, was a PS4 box stuffed full of towels. By the time he had checked the box, the seller was already fleeing the scene.