Deliberate Shortage Edit
The Xbox Shortage Hoax of 2005

Deliberate Shortage - The PS2, XBox, and now the XBox 360 all followed the same release pattern: Christmas release, massive shortages, unmet demand. Then Q1 comes along, and voila. No more shortage. Why? By creating a deliberate shortage at the time of initial release, companies can create hype, generate excitement, and make it every kid’s (and parent’s) mission to find this toy. You lose out on the initial burst of sales, but this only accounts for a percentage of the total planned sales. Brilliant.

“Gaming enthusiasts camp outside electronics stores, desperate to buy the hot new game console. Corporate flacks are deployed to fend off PR calamity: “Consumer demand for the new console has exceeded our expectations, and we are doing all we can to fulfill the wish lists of people who want a new console under their tree this holiday season.”
These spectacular sellouts have become as much of a holiday staple as turkey and stuffing. And, of course, they have inspired conspiracy theories. Isn’t it a little odd that the same story comes round year after year? Is Microsoft really running short of consoles? Yet, for economists, the Xbox 360 crisis is more alarming than a conspiracy, because these supply shortages make no economic sense whatsoever. Despite their suspicious regularity, the shortages benefit nobody.
It isn’t the scarcity of supply itself that is puzzling. That is almost inevitable for some of these seasonal toys. In any given year, many toys will be unloved and oversupplied, but a few lucky ones will be in unexpectedly high demand. We shouldn’t be surprised any more than we’re surprised that the champion of a knockout tennis tournament won all his matches. Somebody had to.” - Slate.com