Is that really the case though? The whole thing looks more like the Switch Lite rise in Japan in early 2020 when an SKU that wasn't very desired in the first place was temporarily able to sell better than the main model due to an ongoing misguided ratio in production capacities. In other words, had Microsoft produced Series X and Series S with an 80:20 ratio instead of the likely 50:50 ratio they've been doing, they would have sold all Xboxes regardless and have an easier time doing so, because the SKU with the significantly bigger demand would have been better stocked all along.
A thought connected to that is that the PS5 demand we've been seeing all year may also be a direct consequence of the low number of Series X consoles being around. It's no secret that for a lot of gamers third party multiplats are the most important games, so PS5 and XSX are interchangeable, at least in the USA and the UK. We can tell from the numbers during the respective first year that there were more PS4s and XB1s combined available than PS5s and XSXes combined; the wrongly estimated XSS demand and subsequent production ratio is the cause for that. While the conventional wisdom is that the PS5 is in higher demand than the PS4, this may actually not be completely true as a lot of people who couldn't get an XSX will have settled for an easier to find PS5 all year long.
I think you have a point here. I do think demand is outstripping supply for the high powered (and high priced) console like PS5 and Series X.
However, I'm not sure if there is a 1 to 1 conversion between making a Series X vs. a Series S. Nintendo seems to be able to make a lot more systems than either Sony or Microsoft. I am not sure why this is, but I would assume that is either 1) because their chips are of a lower power/cost and therefore it is easier to have more of these parts available or 2) it is a different size chip and therefore they are not competing with Sony and Microsoft for the same pool of chips (or maybe a combination of both). Either way the same the argument applies to the Series S vs. Series X. It may be easier to manufacture more Series S systems, because it has a weaker processor than the Series X.Last edited by The_Liquid_Laser - on 19 December 2021