Here’s a mix of good and bad news for Microsoft. The Xbox 360 sold so well during the holiday season - 1.3 million sold in December - that you can’t find it on store shelves now. Apparently, MS didn’t anticipate the console being a hot commodity and retailers are not too happy with their misjudgment. The shortage is expected to last through the quarter and MS is hoping to meet demand again in the spring. That’s an awful long time if you ask me.

So that might not have been good news per se, but this really isn’t good news. The 360 has problems and we’re all aware of that. The RROD has reared its ugly head on more than one CG staffer’s 360. I haven’t had any problems with my Elite, yet. Hopefully it stays that way, but I won’t be surprised when and if it does. My brother has had his 360 for two years and hasn’t had any problems. Now MS estimated that failure rate for the console was at 3 percent, but retailers have pegged it as high as 1/3 of all systems. That’s a pretty wide gap, but recent reports from SquareTrade have revealed that it’s actually at about 16.4 percent. Sony’s PS3 and Nintendo’s Wii are significantly lower at around 3 percent. What’s more surprising is that the CEO of SquareTrade, Steve Abernethy, seems to think that the number will rise in the future. He didn’t say by how much, but 360 owners play for long periods of time and MS hasn’t really been able to fix the overheating problems so we might see more tweaking to the warranty. That sucks. Maybe I’ll keep my Elite in a temperature controlled chamber. Yeah. That’s a good idea.

Report Claims Xbox 360 Failure Rates at 16% [1up]

Microsoft seeing Xbox shortages in U.S. [Reuters]