I think this is called price discrimination[1]. Joel wrote a good article on this topic called Camels and Rubber Duckies[2]. Here is a quote:
>You see, by setting the price at $220, we managed to sell, let's say, 233 copies of the software, at a total profit of $43,105, which is all good and fine, but something is distracting me: all those people who were all ready to pay more, like those 12 fine souls who would have paid a full $399, and yet, we're only charging them $220 just like everyone else!
>The difference between $399 and $220, i.e., $179, is called consumer surplus. It's the extra value that those rich consumers got from their purchase that they would have been perfectly happy to do without.
>It's sort of like if you were all set to buy that new merino wool sweater, and you thought it was going to cost $70, which is well worth it, and when you got to Banana Republic it was on sale for only $50! Now you have an extra $20 in found money that you would have been perfectly happy to give to the Banana Republicans!
Why don't they just stop producing the old?