There's no connection between shares purchased on margin and shares shorted.
When your broker allows you to short a stock, he is promising that he can get the shares to cover that short. That's all that's happening. Unfortunately regulation over this area by the SEC is so poor, that there are times when the number of shares shorted in a security exceed the number of shares issued in that security. In other words brokers collectively have promised they can get non-existing shares. That's another level of dysfunctionality that is real.
"One other possibility is a competitive product coming out that is cheaper."
Where, where? These things don't just materialize. It takes years of research and collaboration to perfect a techniques to accurately sequence dna. The hundreds (or thousands) of people involved would hardly be sworn to secrecy.
That's not the case.
Has your broker ever asked you for permission to borrow your shares? He's never asked anyone else either.
When you short a stock, your broker borrows the shares on his own volition. He does not need permission.
I mentioned this to my Mercedes dealer but he still says I can't borrow my neighbor's 550 without his permission. You're confusing the rigged apparatus known as the market with reality outside said market.
" Sorry I'm not selling you my options."
Unfortunately that's not your decision. Your shares can be borrowed against your wishes. That's just one more aspect of the dysfunctional market we operate within.
These numbers are subject to revision. I'd be willing to place a $5000 bet that the revised numbers will be completely different. It's bizarre that these numbers are even released before they're final.