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nobody with basic business understanding would seriously suggest that the artificial shortages are a thing. The only way it could benefit a business is if it was done in an extremely marginal way; i.e. providing very SLIGHT amount less than demand as to maintain a fake hype.

Unfortunately if you're in a scenario where you're providing a fraction of the amount of systems in relation to demand- it provides extremely limited benefits. It stops/prevents larger software sales (the bread and butter of the industry), and potentially results in somewhat bad PR for a business (threads exactly like this which suggest the company is not necessarily looking out for their customers).

Beyond a business perspective- there is a lot of background talk recently with the scarcity of certain components for mobile electronic devices; only a few companies are currently making extremely high end parts and the resources used to create these are highly limited. when you're competing with Apple or Google for manufacturers- well there really is NO competition. You just wait your turn. That's where Nintendo is at currently.


Again, artificial scarcity only makes sense when marginally done to build a bit of hype while maintaining solid sales. If you're providing a fraction of the systems that could potentially sell then that's just suicidal as a company like Nintendo certainly wants high revenue ASAP because that's what funds future development of games (its a circular thing).

Artificial shortages also are somewhat illogical on really hot products. Something like the Switch is useless to deliberately undersupply because it has great word of mouth currently and is pretty positive online. IF this was a Wii U scenario where the initial allotment had taken a while to sell and was doing mediocre- undersupplying might make sense to be safe and to potentially make people want something they can't get it (although rarely does that actually work because in the end the demand is there or it's not, regardless of supply). 

In the end we have an awkward combination of Nintendo likely being conservative going into this generation after what happening with the Wii U's initial gigantic first week supply sitting in stores for months- and a difficulty with the top manufacturers of specific parts that the Switch and other mobile devices use and have in common.

I don't think what has happened is rocket science and the artificial scarcity stuff is just absurd and generally has not explanation in theory. It's like the people who claimed the NES Classic was deliberately being undersupplied despite the demand. Ehrm... yeah... Nintendo undersupplied the system to build hype and then just discontinued it entirely when they don't appear to have plans for Virtual Console anytime soon on the Switch. The point being that there was no scarcity ploy, and that people just give frustrated and come up with asinine theories.

Nintendo misread how well the Switch would do (as did many people online), and happened to decide to try to boost supply in an awkward period of time where there is high demand for the same parts for different electronics. That's all