I think I recall hearing that Nintendo manufactures all the disks for their systems? I am going to look for verification, but that could have something to do with it (if true).

 EDIT:

Ah, although this is the first time I've heard a Publisher complain about this...

I don't want to forgive Nintendo so easily...Wii consoles are supply constrained...they knew how many Wii's they were making...so they knew how many they were selling too, in this environment. So they would have us believe they cranked out more wii's than they were able to crank out discs to support...something doesn't wash. Hopefully its not really too serious and this guy was looking for explanations for his own companies poor performance...

Nintendo probably just pretends to have a shortage and just doesn't want to give any discs to Midway. ^^

Everyone please recognize what this means, because the complaint could be reasonable.

Nintendo manufactures all the discs used to burn/produce Wii games in a factory themselves, then ships those discs to the third party software companies. Because of the Wii's exploding demand, Nintendo may not have made enough of those discs. Midway's older titles may be crunched by this problem.

That's it, and that may be a legitimate concern.

Not to mention the fact that you have SMG releasing in all three regions soon, and I am sure most publishers want more discs then normal to be ready for the holiday rush.

 I can see it now.

 Nintendo exec has a million discs to distribute. Is he going to ship them to lamer Midway, or totally awesome Capcom.

 Which to choose? Tough decision. :P

I don't where Iribarren says anything about Nintendo's disc manufacturing capacity. He just says Nintendo Wii. So without clarification, his assertions are beyond ludicrous.

Also, this report is in response to the July-September period. The only 1st party game in that period was Metroid Prime 3. I doubt Nintendo was stockpiling discs for anything big during that period.

If Midway just wanted to BS, they could have said "we're still trying to figure out how to make good Wii games" (like RadioioRobert said.) But instead they claimed a shortage. If it were a disc shortage, Midway should have said "there is a shortage of Wii disks, so we couldn't make many Wii games this year." Especially since this is a stockholder conference call.

Yeah, I'm still confused here unless I'm supposed to assume Midway is dumb. Which...I don't want to.

If you read the link I posted above, it states that a followup question was asked that clarified that it was a disc shortage.