8 ms·

It seems to me like most of the (alleged) benefits of scalpers would be equally well achieved by selling (some fraction of) the items in auctions, instead of ju

by drdeca 5y ago

It seems to me like most of the (alleged) benefits of scalpers would be equally well achieved by selling (some fraction of) the items in auctions, instead of just picking a price. However, my impression is that consumers would view this in a negative light, and that the harms to the seller’s reputation would be enough to outweigh the initially increased income. This seems to be the source of the inefficiencies that scalpers exploit/address. This leads me to an idea which, I don’t believe is typically done, but which I don’t know why not: Why wouldn’t a company just, list a price that they are “going to sell it at”, and then “sell” a large proportion of them at that price to an entity which isn’t publicly connected to the company, and then that organization sells the items via auction (and returns a large proportion of the profits back to the company). While on the one hand, I don’t see how I’d be able to tell if this was what was done, and therefore don’t see how to confirm that this isn’t what is being done in the cases where there are scalpers, I don’t think this is being done, and don’t know why.

deleted 5y ago
[deleted]
birdyrooster 5y ago
I and many other gamers have a negative view of Nvidia because of their inability to thwart scalpers and crypto miners. To quote a wise man, "so Nvidia, fuck you!"
- drdeca 5y ago
  Ok, but like, would their overall reputation be higher if they were to directly put some proportion of their inventory up for auction (like, each item individually, not like one auction for a bundle of a very large number of GPUs) instead?
  - jhanschoo 5y ago
    No, the prices will still be comparable to scalper prices, and the cost-conscious consumer market will remember the company's price gouging when they make their next-generation purchase
    - drdeca 5y ago
      This response was initially confusing to me, but thinking about it, I think it led me to realize that complaints about things like this are, essentially, an attempt at coordination among consumers, in order to collectively get a better deal. If there were only a single consumer, a monopsony, they would have a large degree of influence on the price. Building a public consensus on what prices are reasonable and what prices are "too high" allows for exerting similar pressures on the price, as if there were an organization which represented a large portion of the consumers and which would make a single decision for all of that portion (like, a purchasing union thing). I hadn't realized this.
  - birdyrooster 5y ago
    No, but at least they are being enriched to invest in research and development instead of some arbitraging trolls that will spend it on hookers and blow.
- jrockway 5y ago
  It's not really NVidia's fault. The problem is that you can buy a GPU for $1000 and use it to print $2000 of money. That's annoying because most people just want to play a computer game, not print $2000 worth of money. The other thing NVidia could do is keep all their GPUs for themselves and mine crypto.
  - ekianjo 5y ago
    > The other thing NVidia could do is keep all their GPUs for themselves and mine crypto. Who says they are not already doing that in some capacity?
    - avianlyric 5y ago
      That sounds like a lot of work, and a PR nightmare if the public ever found out. Nvidia is already a money printing machine, and their margins are growing. I doubt it’s worth the time investment and risk exposure to the crypto markets for Nvidia. Better off using that time a money inventing better money printers.
      - hef19898 5y ago
        Why would you start digging for gold if you are already becoming rich producing and selling the shovels?
        jrockway 5y ago
        I guess it's easier to make a shovel than it is to make a GPU, and it's easier to do industrial-scale crypto mining for a company that already owns a datacenter than it is to build an industrial earth processing operation. If NVidia wanted to mine a lot of coins, they no doubt have a few employees that could get that started. But it doesn't seem like they want to, perhaps because it's not a sustainable business or perhaps because their customers are already mad at them and they don't want to make it worse. (Though it's not really their fault that customers are mad at them; they're actually mad that someone invented cryptocurrency, which is not NVidia's fault.)
lmm 5y ago
> This leads me to an idea which, I don’t believe is typically done, but which I don’t know why not: Why wouldn’t a company just, list a price that they are “going to sell it at”, and then “sell” a large proportion of them at that price to an entity which isn’t publicly connected to the company, and then that organization sells the items via auction (and returns a large proportion of the profits back to the company). That's often how a lot of today's "scalping" is done - AIUI a lot of "secondary market" tickets on StubHub etc. are sold by an entity that's owned by TicketHub or whoever, so that the artists can sell their tickets at the price the market will bear but put a low face price on them for the sake of their reputation.
xyzzyz 5y ago
This is exactly how concert ticket scalpers work. Bands/producers covertly but with full awareness sell most of the ticket to scalpers, which outsources the reputation hit.
- Lev1a 5y ago
  My mother told me about some new anti-scalper scheme she encountered recently when she was looking at ordering concert tickets for herself and my father. It went something like this: - basket size limited to IIRC a maximum of five tickets for the same concert, - name of the buyer is linked to (idk, maybe even printed on) the tickets AND - the named buyer would have to be there with the group to enter the venue. I think this would probably be pretty effective in countering that bottom-feeding scum called scalper.
  - xyzzyz 5y ago
    You don’t seem to have caught my point: it is the bands themselves that work with the scalpers. They sell a chunk (often majority) of tickets directly to the scalpers for a price above what they publicly claim to charge. Then, they introduce measures like you describe, to reduce competition from grassroots scalpers, to ensure stable business situation for the anointed scalpers. This arrangement works great: the reputation hit is very successfully outsourced to what you call “bottom feeding scum”. The band benefits from higher profit than they would otherwise be able to get if they tried to sell all their tickets at the publicly advertised price, which quite apparently is below the market clearing price. Ticket availability is increased: instead of having to fight to book the tickets in 8 seconds after the registration is opened, everyone can buy tickets at their leisure, simply paying more for convenience when they buy from scalpers. Let me ask you this: for the band you are talking about, despite all the measures you describe, you still could buy tickets on StubHub, no?
matkoniecz 5y ago
Maybe producer can sell some part on auction and donate extra income to some charity? At least this way parasitic scalpers would not benefit. (this assumes that charity would be some actual charity, not just existing to transfer money to family of CEO or something similar)
keyringlight 5y ago
There was a minor controversy nearly a year ago where a MSI subsidiary that was only supposed to get old/refurb stock managed to get new stock of the nvidia 30 series and then proceeded to sell them with inflated pricing. Being charitable I'd say it's likely someone over-enthusiastic at that subsidiary and it blew up in their face, but it doesn't help with them being perceived as fair

by drdeca 5y ago

deleted 5y ago

[deleted]

birdyrooster 5y ago

I and many other gamers have a negative view of Nvidia because of their inability to thwart scalpers and crypto miners. To quote a wise man, "so Nvidia, fuck you!"

drdeca 5y ago
Ok, but like, would their overall reputation be higher if they were to directly put some proportion of their inventory up for auction (like, each item individually, not like one auction for a bundle of a very large number of GPUs) instead?
- jhanschoo 5y ago
  No, the prices will still be comparable to scalper prices, and the cost-conscious consumer market will remember the company's price gouging when they make their next-generation purchase
  - drdeca 5y ago
    This response was initially confusing to me, but thinking about it, I think it led me to realize that complaints about things like this are, essentially, an attempt at coordination among consumers, in order to collectively get a better deal. If there were only a single consumer, a monopsony, they would have a large degree of influence on the price. Building a public consensus on what prices are reasonable and what prices are "too high" allows for exerting similar pressures on the price, as if there were an organization which represented a large portion of the consumers and which would make a single decision for all of that portion (like, a purchasing union thing). I hadn't realized this.
- birdyrooster 5y ago
  No, but at least they are being enriched to invest in research and development instead of some arbitraging trolls that will spend it on hookers and blow.
jrockway 5y ago
It's not really NVidia's fault. The problem is that you can buy a GPU for $1000 and use it to print $2000 of money. That's annoying because most people just want to play a computer game, not print $2000 worth of money. The other thing NVidia could do is keep all their GPUs for themselves and mine crypto.
- ekianjo 5y ago
  > The other thing NVidia could do is keep all their GPUs for themselves and mine crypto. Who says they are not already doing that in some capacity?
  - avianlyric 5y ago
    That sounds like a lot of work, and a PR nightmare if the public ever found out. Nvidia is already a money printing machine, and their margins are growing. I doubt it’s worth the time investment and risk exposure to the crypto markets for Nvidia. Better off using that time a money inventing better money printers.
    - hef19898 5y ago
      Why would you start digging for gold if you are already becoming rich producing and selling the shovels?
      - jrockway 5y ago
        I guess it's easier to make a shovel than it is to make a GPU, and it's easier to do industrial-scale crypto mining for a company that already owns a datacenter than it is to build an industrial earth processing operation. If NVidia wanted to mine a lot of coins, they no doubt have a few employees that could get that started. But it doesn't seem like they want to, perhaps because it's not a sustainable business or perhaps because their customers are already mad at them and they don't want to make it worse. (Though it's not really their fault that customers are mad at them; they're actually mad that someone invented cryptocurrency, which is not NVidia's fault.)

lmm 5y ago

> This leads me to an idea which, I don’t believe is typically done, but which I don’t know why not: Why wouldn’t a company just, list a price that they are “going to sell it at”, and then “sell” a large proportion of them at that price to an entity which isn’t publicly connected to the company, and then that organization sells the items via auction (and returns a large proportion of the profits back to the company). That's often how a lot of today's "scalping" is done - AIUI a lot of "secondary market" tickets on StubHub etc. are sold by an entity that's owned by TicketHub or whoever, so that the artists can sell their tickets at the price the market will bear but put a low face price on them for the sake of their reputation.

xyzzyz 5y ago

This is exactly how concert ticket scalpers work. Bands/producers covertly but with full awareness sell most of the ticket to scalpers, which outsources the reputation hit.

Lev1a 5y ago
My mother told me about some new anti-scalper scheme she encountered recently when she was looking at ordering concert tickets for herself and my father. It went something like this: - basket size limited to IIRC a maximum of five tickets for the same concert, - name of the buyer is linked to (idk, maybe even printed on) the tickets AND - the named buyer would have to be there with the group to enter the venue. I think this would probably be pretty effective in countering that bottom-feeding scum called scalper.
- xyzzyz 5y ago
  You don’t seem to have caught my point: it is the bands themselves that work with the scalpers. They sell a chunk (often majority) of tickets directly to the scalpers for a price above what they publicly claim to charge. Then, they introduce measures like you describe, to reduce competition from grassroots scalpers, to ensure stable business situation for the anointed scalpers. This arrangement works great: the reputation hit is very successfully outsourced to what you call “bottom feeding scum”. The band benefits from higher profit than they would otherwise be able to get if they tried to sell all their tickets at the publicly advertised price, which quite apparently is below the market clearing price. Ticket availability is increased: instead of having to fight to book the tickets in 8 seconds after the registration is opened, everyone can buy tickets at their leisure, simply paying more for convenience when they buy from scalpers. Let me ask you this: for the band you are talking about, despite all the measures you describe, you still could buy tickets on StubHub, no?

matkoniecz 5y ago

Maybe producer can sell some part on auction and donate extra income to some charity? At least this way parasitic scalpers would not benefit. (this assumes that charity would be some actual charity, not just existing to transfer money to family of CEO or something similar)

keyringlight 5y ago

There was a minor controversy nearly a year ago where a MSI subsidiary that was only supposed to get old/refurb stock managed to get new stock of the nvidia 30 series and then proceeded to sell them with inflated pricing. Being charitable I'd say it's likely someone over-enthusiastic at that subsidiary and it blew up in their face, but it doesn't help with them being perceived as fair