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Thread: Why Are AMD and NVIDIA INCREASING GPU Prices?

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    Why Are AMD and NVIDIA INCREASING GPU Prices?


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    Banhammer in peace PeterB kalniel's Avatar
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    Re: Why Are AMD and NVIDIA INCREASING GPU Prices?

    To save anyone else watching the video, it's the same thing we've already discussed in other threads - they had excess stock so layered in next gen products above and reduce supply in order to allow channel inventory to clear. Then there's some obvious waffle about the need for margins to increase when unit sales decrease, and finally a statement that when margins are high there's increased scope for competitors to come into the market, ala Intel. Which I think is probably misplaced given the enormous barrier to entry.

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    Re: Why Are AMD and NVIDIA INCREASING GPU Prices?

    While not disagreeing with Kal, and also without watching the original video, my response was

    "Because they can"".

    Or at least, "Because they believe they can, and make more money by doing it."

    And I agree with them. Of course, should they increase prices is a different question but I think that, if they have, why they did is pretty obvious. And the further they go up the product range it refers to, the more self-evidently true it is.

    Why? Who is it that's buying the top tier or two of GPUs? A large factor is going to be, whether we like it or not, those that can afford to. Sorry, but it's how reality works in that, pretty much regardless of what we're talking about, some people can afford it (maybe from pocket change), and some can't afford it at all. Buying a brand new Ferrari is pocket change to those owning superyahcts and/or personal jets and regardless of whether everybody else likes it or not, it won't change short of the kind of mass reaction in the Russian people dealing with the Tzars or the French guillotining the aristocracy. And that is perhaps something the superyacht brigade ought to worry about.

    Back directly to GPUs, if you are seriously in the market for a £1500 GPU then my inference is either that if you an afford a £1500 GPU you can afford a £1700 GPU, or that you (IMHO) probably shouldnt be buying a £1500 GPU in the first place. It is not, after all, exactly a life or death purchase.

    Scale it down to, say, £500 GUs and the same logic applies, but at the £550 GPU price point. If the extra £50 is unaffordable, should you be be spending £500 on that, in the first place. Should people that can't comfortably afford caviar be buying it? Fillet steak, or a cheaper cut and maybe slow cook it? Nobody needs fillet steak, Kobe beef, caviar or £1500 GPUs. Want them? Sure. Need them? Nope.

    And computer hardware manufacturers aren't charities or social services. They produce a product and, shock and surprise, want to maximise profits. Ask Rolex, or Patek Phillippe, if they could make a lot more watches, or Rolls Royce more cars? Yup .... but it may well not be the most profitable strategy.

    Personally, my thoughts on GPU pricing is .... I don't much like it, and I'm not dumb enough they think they couldn't lower prices, or that "layering" hasn't been done by different companies in different ways for decades, at least.

    So my strategy to any computer hardware is, decide what I can afford to pay, within that what do I want, decide if product X is worth the prevailing price to me, and if it isn't, either wait, or buy something else. On that basis, I'm still waiting for Aston Martin to lower their prices .... but not holding my breath while I wait.
    A lesson learned from PeterB about dignity in adversity, so Peter, In Memorium, "Onwards and Upwards".

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    Re: Why Are AMD and NVIDIA INCREASING GPU Prices?

    Quote Originally Posted by kalniel View Post
    Which I think is probably misplaced given the enormous barrier to entry.
    I agree. Intel seem to have given up, just as they also seem to be getting their drivers into some sort of usable shape.

    The fact that Matrox are these days re-selling AMD chips with their own boards and drivers shows that this is hard.

    I think the high prices add to the barrier though. I would happily take a punt on an Intel graphics card at £50. I might take a punt if it looked like good value at £100. But £400? I'm out. I have to know it will just work at that price.

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    Re: Why Are AMD and NVIDIA INCREASING GPU Prices?

    It appears pc gaming is dying and will soon be dead as it is now dying, personally I need a reasonable GPU for work to which my vega 56 is going fine and it is also playing the games I want to play.

    Historically I have always bought in the £200-£300 range either new or old higher end as new gpus come out but ti appears that segment of the market has been completely abandoned with absolute garbage cards, 6500xt doesn't have 2 display ports that I need the 6600 is only a marginal upgrade and the 6600xt is over overpriced for such an old card of its performance.

    If an A770 appeared between £250-£275 I would give it a go.

    Looking at steam users the most popular gpus are the 1650, 1060 and 2060 which shows a lot of people also settled with reasonably powerful older gpus with no justifiable upgrade path like me.

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    Re: Why Are AMD and NVIDIA INCREASING GPU Prices?

    This is not ging to be popular, even with me, but I think the fact that prices are still as high as they are especially for mid to to tier, suggests that nVidia (and AMD to a degree) believe they can, first, sell their cards, and second, make moe profit at those prices. Thing is, there wwill always (short of a total financial upheaval like a Star-trekian abolition of money) be quite a few thatcan afford high-end cards. There are enough people buying new Merc/BMWs (let alone exotica), fancy watches, stupidly espensive fashion accessories, first class air flights and, well, everything. If there weren't, tose things wouldn't be the prices they are, or maybe exist at all. Graphics cards, in that sot of company, aren't expensive items. £5k for a watch, £60k for a car, ever piced up a firs class trasatlantic flight? There is a LOT of mney floating about. £1k-32k for a GPU? Not that much to those folks. And if there's enough for mfrs to sell their stock over a perid of time they're happy with? Then, prices ain't coming down, and they don't care about what we all think of it.
    A lesson learned from PeterB about dignity in adversity, so Peter, In Memorium, "Onwards and Upwards".

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    Re: Why Are AMD and NVIDIA INCREASING GPU Prices?

    Quote Originally Posted by Saracen999 View Post
    This is not going to be popular,
    I think there is some truth to that. Most of the younger people I work with don't really drink, smoke or drive. That frees up quite a bit of income. But then most of them are on consoles as well, or will just buy a complete pre-assembled gaming PC from the likes of Scan every 5 years.

    But still, I think it fundamentally blocks out the upgrade market. I have a price point I'm willing to pay, and if prices keep going up with performance rather than performance going up at a particular price point then I will never replace this card. Is this market so small they can bin it?

    On the other end of the market, I spent yesterday playing Minecraft on the new company server with the integrated graphics of a Ryzen 7900 (got to shake it down somehow ) and it's totally playable. That's a 2CU graphics setup with shared memory. We don't need the very low end any more, but the ~£60 market that used to be thriving is now junk.

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    Re: Why Are AMD and NVIDIA INCREASING GPU Prices?

    Quote Originally Posted by DanceswithUnix View Post
    I think there is some truth to that. Most of the younger people I work with don't really drink, smoke or drive. That frees up quite a bit of income. But then most of them are on consoles as well, or will just buy a complete pre-assembled gaming PC from the likes of Scan every 5 years.

    But still, I think it fundamentally blocks out the upgrade market. I have a price point I'm willing to pay, and if prices keep going up with performance rather than performance going up at a particular price point then I will never replace this card. Is this market so small they can bin it?

    On the other end of the market, I spent yesterday playing Minecraft on the new company server with the integrated graphics of a Ryzen 7900 (got to shake it down somehow ) and it's totally playable. That's a 2CU graphics setup with shared memory. We don't need the very low end any more, but the ~£60 market that used to be thriving is now junk.
    Yeah, lots of layers to that.

    Different generations live very different lives these days. Truthfully probably always (last 50 or 100 years anyway) did. I'm retired, and already spend the requite loadsa years paying off the mortgage. That makes a BIG dfference. It's one argument for scrimping and scraping, and making lots of sacrifices, for earlier years getting on the property ladder. One you're mortgage (and rent) free, your toal income can (and no doubt will) go down but disospable income can still actually go up.

    Another generational difference (IMHO) is about mortgages. I (and for sure, a number of us older ones) remember times before central bank interest rates were near-zero for, what, a decade-plus in a row. Where the current pain-inflicting rates would still be low compared to what we were paying, when 8% wasn't a bad deal and albeit farly briefly, we hit 15% And very briefly, even 17%. A couple of years into my last mortgage, my monthly payment almost doubled and, at the same time, the value of the property I'd just bought (ad go a mortgage on) about halved. Fortunately, in the couple of years between purchase and finamcial crisis, it'd doubled so halving only took it back t pretty much par. I'd saved a good lum sum first and only mortgaged about 60% of the property. If I'd bought a more expensive place, with the 95% loan I as offered, there is zero doubt in my mind the bank would have foreclosed and we'd have lost it. And that was far from uncommon.

    Even now, owning isn't entirely a one-way street. A relatively minor roof issue just cost £5000, and we're looking at probably £40-50k for what is a good quality but by no means poncy kitchen and bathroom refit. If we rented (from a decent landlord) we'd get both refgits done for us (they are BADLY needed) but, I very much doubt to the level we want, which is designed to be a "forever" home and we want good enough quality to never need to do it again.

    My point? We're not rich by any means, but not hard up and can afford all that, but certainly not to keep doing that kind of thing indefinitely. Perhaps most insidiously, much of that requires dipping into savings and yes, we can afford to do those refits, not without seriously denting savings which will be hard or impossible to replace. Even with current energ prices, income still exceeds outgoings, resulting in way less stress than a very large number of people but, as per above, been there, done that, when it comes to worrying about how the hell to pay the next bill.

    That is one of those generational differences - not assuming that because interest rates have been "low" for some years, that they always will be. I well remember the pain of those days, and it shaped our future VERY cautious approach to spending. However, in our sunset years, I could just go buy a 4090. Easily. But I won't because, to me, they're too expensive and I won't spend that much on a GPU. But if you've ever watched someone fork out £250k, in cash, for jewelry .... well, you start to realise how some people live. And that was about 40 years ago, when £250,000 would have bought you, oh, about 4 houses like the one I had.

    That is the kind of money some have. That particular person was an extreme example (Saudi royal family) but there's a LOT of people with what the average working person would regard as huge incomes/resources, without going to Saudi royals or billionaire industrialist standards.

    I doubt many people that can afford a £50k car, and there's more than a handful like that been on Hexus over the years (may well still be) that couldn't pay £1500 for a GPU if they really wanted to. Ironically in a way, that there are so many that can, albeint a small number compared to those that can't, is exactly why AMD/nVidia can keep prices high - the more they up the volume they ship, the less true that will get, over time. It's not in their interests, I'm sure they have calculated, to drop prices much. Not yet, anyway. Any more than Rolex, et/al., couldn't if they didn't feel that low volume/high price was more profitable than much lower price, and pick up from the supermarket with a packet of crisps and a coke.

    The best those struggling to go higher (or to justfy going higher) than what passes for "budget" cards these days, can hope for is either Intel ARC or hiping that ARC puts enough pressure on AMD and nVidia fr force them to react. But if they do, it won't be with 4090s. About the only things I see bringing high-end card prices down much if at all, any time soon, is if/when they finally exhaust high-ish end 30xx cards, and/or demand for 4080/4090 at current prices dries up.

    The first big unknown in that is what their 30xx stock is currently like? The second is that, excluding miners, the vast bulk of home users only upgrade their GPUs every few years. There is undoubtedly a backlog of frustrated users who either wouldn't pay prices over the 'pandemic years', or even if they would, couldn't lay hands on a card. But that backlog is undoubtedt reducing and sooner or later, will be satisfied. When it is, then maybe we'll see a 're-adjustment' to a new normal, but I have my doubts that we'll get back to anything like pre-pandemic and pre-scalper prices any time soon. If ever. It's one (but not the only) reason I'd go as far as RX 7900XTX .... I only intend to do it ONCE.
    A lesson learned from PeterB about dignity in adversity, so Peter, In Memorium, "Onwards and Upwards".

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    Re: Why Are AMD and NVIDIA INCREASING GPU Prices?

    OFC they are - its a cartel. Sadly people have been paying more and more for cards,especially during the pandemic,where too many had to pay above RRP. Gamers tend to be incredibly vulnerable to FOMO(and geeks in general IMHO),so it's why microtransactions make so much money. We are all partially to blame for how it's turned out over the last decade. Hence these companies have figured out they can unofficial price fix between each other,and jack up new product pricing. At this point they can keep their overpriced wares. The computing and gaming market is too much of a debt driven speculative bubble - too much money has been printed. It means companies borrow unsustainable amounts of money,which means they have to increase pricing. Consumers then use credit to pay for the increased prices. Interest rates rising and a cooling world economy means these companies need to enter some level of reality. The good years are over for the time being IMHO.
    Last edited by CAT-THE-FIFTH; 06-02-2023 at 01:30 PM.

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    Re: Why Are AMD and NVIDIA INCREASING GPU Prices?

    Quote Originally Posted by CAT-THE-FIFTH View Post
    Gamers tend to be incredibly vulnerable to FOMO(and geeks in general IMHO),so it's why microtransactions make so much money.
    I don't think that's substantiated. The majority of gamers are on cards several generations old - if they had FOMO they'd be on the latest generation or two.

    Just looking at the steam hardware survey (https://store.steampowered.com/hwsurvey/videocard/) you can see how popular pascal generation cards are still for example.

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    Re: Why Are AMD and NVIDIA INCREASING GPU Prices?

    Quote Originally Posted by kalniel View Post
    I don't think that's substantiated. The majority of gamers are on cards several generations old - if they had FOMO they'd be on the latest generation or two.

    Just looking at the steam hardware survey (https://store.steampowered.com/hwsurvey/videocard/) you can see how popular pascal generation cards are still for example.
    It is when microtransactions make so much money. Plus prices won't have generally gone up if people were not buying and you just have to look at the gaming revenues of companies like Nvidia(and their margins too). Turing wasn't even a failure - it still sold well despite Nvidia doing what it did.

    I have had enough arguments with people on forums OVER the last decade,who defended all of this stuff. I said this point would be reached years ago. I have been proven correct and all the people who defended the price rises have run away or suddenly have had mass amnesia. Have people already forgotten what I said about Zen3 and AMD trying to price worse than Intel? Lots of people on forums defending AMD pricing CPUs worse than Intel. I told people Zen4 and whatever Intel would have would go up even more. It happened as predicted.

    I told people not to pay above RRP,for dGPUs and parts during the pandemic. People did it anyway. I said Turing was a result of people paying way above RRP after the last mining craze,so they tried to reset pricing back then too. Again it happened. These parts are being priced at pandemic FOMO level pricing which was way above RRP.

    The sad reality is that just merely participating in the hobby means you can't even get away from it,because everything gets affected by the upselling even crap like the RX6500XT. If parts go kaput you have no choice but to buy at the new pricing. At this point I might just get a console,and use a laptop for older games.

    The only reason the bottom is starting to fall out is because rising commodity costs,interest rates,etc have meant people can't borrow as easily and they simply have less and less disposable income. But instead of trying to stimulate more demand,they believe enough Whales exists that after a few rubbish quarters it will even out.

    It's always "poor gamers" who are not at fault for anything. Its miners,etc. Yet the same blameless gamers spent silly money on AAA games,pay for all the game passes,microtransactions,cosmetics,etc. You can just look at the financials to see this. So now you can pay full price and still not get a full game.

    Just more and more FOMO. I am out as I frankly have gotten fed up of it all.

    PS: I am not going to have another useless endless argument about this. It's the same arguments for the last decade. The same outcome all the time. Its almost moving to some weird level of Stockholm Syndrome level denial.
    Last edited by CAT-THE-FIFTH; 06-02-2023 at 02:29 PM.

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    Re: Why Are AMD and NVIDIA INCREASING GPU Prices?

    Quote Originally Posted by CAT-THE-FIFTH View Post
    I told people not to pay above RRP,for dGPUs and parts during the pandemic. People did it anyway.
    I'm sure some people did, but the point of my post was they're in a minority. The hardware survey link provides evidence of that - most people are gaming on pre-pandemic parts. Very few people are gaming on the latest. Ergo, FOMO isn't a thing in the wider market.

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    Re: Why Are AMD and NVIDIA INCREASING GPU Prices?

    Quote Originally Posted by Percy1983 View Post
    It appears pc gaming is dying and will soon be dead as it is now dying
    People have been saying that for decades, now, yet here we remain.....
    _______________________________________________________________________
    Quote Originally Posted by Mark Tyson
    like a chihuahua urinating on a towering inferno...

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    Re: Why Are AMD and NVIDIA INCREASING GPU Prices?

    Quote Originally Posted by CAT-THE-FIFTH View Post
    OFC they are - its a cartel. Sadly people have been paying more and more for cards,especially during the pandemic,where too many had to pay above RRP. Gamers tend to be incredibly vulnerable to FOMO(and geeks in general IMHO),so it's why microtransactions make so much money. We are all partially to blame for how it's turned out over the last decade. Hence these companies have figured out they can unofficial price fix between each other,and jack up new product pricing. At this point they can keep their overpriced wares. The computing and gaming market is too much of a debt driven speculative bubble - too much money has been printed. It means companies borrow unsustainable amounts of money,which means they have to increase pricing. Consumers then use credit to pay for the increased prices. Interest rates rising and a cooling world economy means these companies need to enter some level of reality. The good years are over for the time being IMHO.
    Where's the line between "unofficial price fix" and, just what the market will bear? I'd suggest theres probably a common-sense ethical (if those two go together) answer to tht, and probably a legal one too.

    Part of the problem is that gaming GUs is effectively a duopoly. I'm not convinced the two actually need to fix anything, even unofficially. Hardware shrtages, mining consumption rates and, maybe the pandemic, taught tem (especially the bigger one) someting .... what people will pay. They will need to unlearn tgat befoe prices will come back down, butt part of the problem is that the last couple of years also taught them that low-volume, high-price an be more profitabe that shifting higher volumes but at much lower prices, esecially if there is little practical competition. If you have something, even if it's just branding, that will convince people to buy, why would they change. Add fashion, or "desirability" and you're set to mint it. After all, fr thhe vast majority of people almost for all purposes, a £5 digital watch from a market stall will tell time as well (sometimes better) than a Rolex, of which the white gold case doesn't ke it tell the time any better. For that matter, with (almost) everybody carrying smartphones, who needs a watch? But I still usually wear one. I prefer it.

    Red and Green dont need to price fix. They overlap a lot, sure, but they don't hit quite the same markets for gaming GPUs, and as long as they're happy shifting the volumes they are at the prces theu are .... why would they cut prices? Especially if the effect is to reduce their own future profits.

    Now that the (GPU) mining thing seems to be over, what's keeping prices high? Mainy, I think, that enough gamers will pay them.

    At this point they can keep their overpriced wares.
    Yes, and no.

    That's precisely the point - they currently can sell at thse "inflated" prices, if lower volumes are okay. If AMD ever start takig large bites out of nVidia sales, then we may see changes but I don't see that happening. Yet.

    And if Intel ever get their act together, maybe ARC will start taking bites out of both, at the low end, that'll put the cat among the pidgeons.

    But currently, they don't need to "fix" prrices. Enough gamers are buying to do it for them, and those that won't? Neither Red nor Green appear to give a f..... fig that they won't.
    A lesson learned from PeterB about dignity in adversity, so Peter, In Memorium, "Onwards and Upwards".

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    Re: Why Are AMD and NVIDIA INCREASING GPU Prices?

    I does seem many miner are still mining the hopium, many have just switched off ready to switch back on 'tomorrow' when profitable. Some are also saying they are now buying more gpus up on the cheap used market ready for that 'tomorrow'.

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    Re: Why Are AMD and NVIDIA INCREASING GPU Prices?

    Quote Originally Posted by Saracen999 View Post
    "Because they can"".

    Or at least, "Because they believe they can, and make more money by doing it."
    Well I was going to build a new system and put a 4080FE into it, but at the price Nvidia want to charge for the generational increase? They jumped from £649 to £1200. Nope, not happening and a lost sale.

    Quote Originally Posted by CAT-THE-FIFTH View Post
    I told people not to pay above RRP,for dGPUs and parts during the pandemic. People did it anyway. I said Turing was a result of people paying way above RRP after the last mining craze,so they tried to reset pricing back then too. Again it happened. These parts are being priced at pandemic FOMO level pricing which was way above RRP.
    I had the 2080FE which was £749 new, I upgraded due to getting more screen real estate to the 3090FE. I would have been quite happy with the 3080FE at £649 but none were available due to the "pandemic" (read: scalpers), so opted for the 3090FE. That is absolutely the most I have ever paid for a new dGPU and it was offset by selling the 2080FE for near it's original retail price. I've got plenty of disposable income, but the prices being charged now? I'd quite honestly go back to console gaming instead as that is my primary use scenario. There is no way I'd consider what Nvidia want to charge for a second (or in reality a third or fourth) tier card.

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