The question is not: does Nintendo at times withhold some units in order to meet the increased demand during times like Christmas, or the release of a major game.
Of course it does. The real stockpiling myth that needs dispelling is the idea I've heard more than once that Nintendo manufactures or releases below its capacity in order to create a bigger "buzz" about its console. That, in fact, Nintendo could easily meet the demand if it so chose, but chooses not to as a business strategy.
I think that this version of the stockpiling myth is silly on its face, because every time Nintendo doesn't sell a console to a prospective buyer due to scarcity, that same buyer might go to Sony, or MS, and might not come back again. Nintendo wants everyone who wants a Wii to get one.
At the same time, Nintendo doesn't want to start producing a million Wiis a month, because the capital investment would be too great to get production to that level, and they'd soon be left with a huge stockpile of unsold Wiis, plus associated storage costs, etc. They have to try to figure the optimal level of production -- neither too big nor too small -- and they have to make changes to overall production levels many months in advance. Industry can be slow moving, and the current production levels are based on operational decisions made probably half a year ago. This is why there continue to be shortages, and why Nintendo must stockpile during select seasons. Too few Wiis during January is a problem, but too few during December is a riot.
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