In context: Sony's next-generation gaming console is here and is arguably the hottest item this holiday season. However, it is practically impossible to get your hands on a PlayStation 5 at retail outlets. Allotments sell out within hours of being replenished. Sony isn't giving solid figures on supply in the US, but sales in Japan are reportedly bleak and will not improve before the end of the year.

Sony's initial production estimates for the PlayStation 5 had the company shipping at least 10 million units during the holiday rush. Reports came out in September that indicated production had been cut by around 4 million units, sparking rumors of a shortage. Sony insisted it was on track and that those rumors were unfounded.

If that's the case, why has Japan only sold 118,000 and will sell no more until next year?

Famitsu notes that Japanese retail outlets have only moved 118,000 PlayStation 5 units in its first four days from launch. The only Japanese launch worse than the PS5 was the PS3, which managed less than 100,000 at launch. For reference, Sony sold over a million PlayStation 4 consoles within 24 hours in the US, and the PS2 sold more than 500,000 units on day one. Furthermore, retailers in the console's home country say they will not be getting fresh allotments until next year.

Keep in mind that Sony has not released global sales figures and likely won't announce them until Q1 2021 when financial reports come out. However, it seems clear from the Japanese sales that it is not a lack of demand holding the console back but a lack of supply. But is lower production causing the shortage?

Scalpers are getting top dollar for the high demand item on third-party selling sites like eBay. There are pages upon pages of PS5 auctions on eBay fetching nearly $1,000 per unit regardless of whether it is the standard or digital version. One digital version closed for $2,025. So the demand seems to be there. It appears scalpers are grabbing the lion's share of units available.

Still, why are Japan's numbers so low? Some reports have suggested that Sony reserved the vast majority of PS5 stock for the US and EU markets because of waning interest in Japan. If this is the case, and Sony's claims of 10 million units before year-end are true, global sales could already be over a million, but that is speculative at best.

The proliferation of scalpers may have a lot to do with the under-stocking situation we are seeing in the US. Sony's unit sales may be much higher than we are led to believe from the lack of retail availability, but we will have to wait until some official figures are released before we know how well the console sold at launch.

Masthead credit: Natanael Ginting