4 ms·

Few events show how rotten the economic incentives are than this GPU scarcity: there are now massive inventories and over-production, huge demand, but prices ar

Few events show how rotten the economic incentives are than this GPU scarcity: there are now massive inventories and over-production, huge demand, but prices are still sky high. Nvidia would rather destroy its inventory than go for pre-crypto prices. A massive amount of users stuck on 5-8 year old cards with still no good choices to upgrade. https://store.steampowered.com/hwsurvey/videocard/ https://store.steampowered.com/hwsurvey/videocard/

ragazzina 4y ago
Why are AMD or any other competition (I don't follow this sector very closely) not taking advantage of this and compete on price?
- metaphor 4y ago
  The big picture I'm seeing is there's a game being played[1], but to your point, AMD did respond to RTX 4070 launch by dropping prices on RX 6800 series GPUs[2]. [1] https://scholarworks.umass.edu/econ_workingpaper/343/ https://scholarworks.umass.edu/econ_workingpaper/343/ [2] https://news.ycombinator.com/item?id=35663511 https://news.ycombinator.com/item?id=35663511
- epolanski 4y ago
  Because gaming GPUs are not really profitable to AMD. As a reference, between 2008 and 2011 when ATI/AMD had the biggest technological lead over Nvidia's disaster architectures, even then when AMD was at near 50% market share it merely posted 19M of profits across 3 financial years! In the same time frame, despite terrible performances, Fermi architecture already going into the 400w consumption range, even then Nvidia posted billions of profits across the same time frame. AMD has simply stopped competing with Nvidia on prices, it's nonsense to them. Nowadays both Nvidia and AMD sell more GPUs to datacenters and super computers, where net margins are also twice as high than they do to gamers. Essentially both AMD and Nvidia are abandoning the gaming aspect of their hardware, stopped competing price-wise, instead they prefer both to sit on higher margins in the gaming market and focus on GPGPU aspect for business, research, automotive, AI, etc, etc, where the real money and growth is. The fact that this hardware is also able to crunch rendering calculations is more and more of a side effect.
  - hoseja 4y ago
    We need games that utilize local neural nets.
    - mepian 4y ago
      It seems that DLSS/XeSS is the only feasible application of local neural nets to games right now, everything else is too compute-hungry.
  - pdpi 4y ago
    AMD has notably cornered the console market with the Xbox One and Series X|S, PS4 and PS5. With the Steam Deck and now the Asus ROG Ally, they're starting to get themselves a position in the handheld market too.
    - themitigating 4y ago
      Is OEM integration profitable though? I would imagine Microsoft and Sony squeezed the best deal and maybe it will bring profit in later years when the research debt is paid
      - soganess 4y ago
        Judging by their conservative clocks and odd configurations (ex steam deck is a 4-core) these are some of the lower bind parts that would otherwise not be high-value final products on the open PC market. Perhaps even "defective" (ex failed PCIe lanes) in some way that makes them useless. I always figured this was a "use the whole pig" situation.
    - epolanski 4y ago
      Sure, but those aren't a company-defining revenues or where huge growth is.
  - prettyStandard 4y ago
    This isn't entirely make sense to me, I thought AMD was very far behind on GPGPU. Do these supercomputer and data center projects use things like ROCm and OpenCL, and solve the software issues on their side? Does AMD compete on price there?
- meltyness 4y ago
  Intel doesn't really have a competing product. AMD and Nvidia sell the same thing made at the same place in Taiwan. Nvidia dove in like 1998. AMD sold it's moat in like, 2005.
- reissbaker 4y ago
  Contrary to what other posters are saying, I do think AMD is actually trying to compete; for example, they finally gave up on OpenCL and are trying to play catch-up to Nvidia via ROCm, effectively allowing you to run CUDA on AMD's server GPU offerings. And on the gaming side their top-of-the-line offering, the 7900 XTX, is ~$600 cheaper (aka 60%!) at MSRP than Nvidia's top-of-the-line RTX 4090 — and the prices you'd pay from e.g. resellers on eBay are even more skewed towards Nvidia. That being said, they're just way, way behind. Nvidia can charge what they do simply because AMD isn't great at making GPUs. In gaming AMD never caught up to Nvidia's raytracing perf, and AMD's attempt to clone DLSS is significantly less performant. Meanwhile in AI/ML the industry consolidated around CUDA because OpenCL was never that great, and — Nvidia owning the standard, and having built around it for over a decade, gives them a really big advantage. Plus, every GPU sold in the last decade+ by Nvidia supports CUDA, whereas only the new server GPUs from AMD support ROCm. Nvidia has executed incredibly well for decades: they pioneered shader programming, CUDA, raytracing, and DLSS. Arguably they even invented the GPU itself with the GeForce 256 in 1999 (as opposed to earlier "accelerator" cards). I struggle to think of anything AMD has done in the GPU space that matches even one of those accomplishments... Their only slight win is having OSS drivers for Linux, but honestly, that doesn't sell a whole lot of GPUs. AMD caught up to Intel on the CPU side in part thanks to Intel's failures. Nvidia just hasn't fumbled. Edit: Also, Intel is trying to edge their way into the GPU market as well with their Arc line of discrete GPUs, which is relatively affordable. They compete well on price, especially at the lower end: the A750 and A380 obliterate anything at their price points ($239 and $119, respectively). But, well, "at their price points" is a pretty critical part of that sentence. Their top-tier card, the A770, can barely eke out wins against the lower end of Nvidia's last-gen cards. And re: 2008-2011 ATI comparisons from a sibling comment — by 2010 Nvidia's Fermi architecture was reliably beating ATI again, albeit with higher power draw, and in 2007 they had just launched CUDA which ended up being the most lucrative market segment for GPUs. In retrospect I think Fermi was much less of a flop than it seemed (and it was a fairly brief one compared to Intel's CPU woes).
  - nl 4y ago
    ROCm development is understaffed and continually considerably behind CUDA too.
metaphor 4y ago
Agreed. At this point, it's clearly artificial GPU scarcity. We felt it early in consumer staples[1], and the grifting by auto dealers wasn't imagined either[2]...I won't even bother with the housing market to preserve my sanity. GPUs are really no different. Consumers need to wake up and smell the underlying meta[3]. [1] https://www.bls.gov/opub/btn/volume-12/measuring-shrinkflation-and-its-impact-on-inflation.htm https://www.bls.gov/opub/btn/volume-12/measuring-shrinkflati... [2] https://www.bls.gov/opub/mlr/2023/article/automotive-dealerships-markups.htm https://www.bls.gov/opub/mlr/2023/article/automotive-dealers... [3] https://scholarworks.umass.edu/econ_workingpaper/343/ https://scholarworks.umass.edu/econ_workingpaper/343/
- epolanski 4y ago
  Not only artificial GPU scarcity. It is obviously clear that AMD and Nvidia are deliberately avoiding fighting each other on prices, something they got punished for in 2008, except that at the time it was done in secret meetings, now it's literally AMD playing alone and avoiding to compete completely on price.
  - jacooper 4y ago
    They compete on price, just not as much as before The 7900xtx is much better deal at 1000$ than 1200$ for the 4080, yet and isnt pushing prices as low as they used to. The difference is AMD actually discounts old GPUs and CPUs, a 6950XT can be found for around 500$ or less.
MrBuddyCasino 4y ago
As long as both have unsold inventory of their older architectures, they will not lower prices of the current generation, and they won't enter a price war. Intel's next generation might be able to exert some pressure, but by then AMD and Nvidia will probably have cleared their old inventory anyway.
chiph 4y ago
I am running on an ancient GTX 1070 and would like to upgrade to an RTX capable card, but there's no way I'm paying the current prices. I'm not sure why the prices remain high, after the crypto crash and pandemic shortages have eased. Cost of the Nvidia license? Cost of materials + production? Unrealistic profit projections? Probably a mix of all three.
- dontlaugh 4y ago
  Same. I'm sticking with my even more ancient 970, it'll do for a while longer.

ragazzina 4y ago

Why are AMD or any other competition (I don't follow this sector very closely) not taking advantage of this and compete on price?

metaphor 4y ago
The big picture I'm seeing is there's a game being played[1], but to your point, AMD did respond to RTX 4070 launch by dropping prices on RX 6800 series GPUs[2]. [1] https://scholarworks.umass.edu/econ_workingpaper/343/ https://scholarworks.umass.edu/econ_workingpaper/343/ [2] https://news.ycombinator.com/item?id=35663511 https://news.ycombinator.com/item?id=35663511
epolanski 4y ago
Because gaming GPUs are not really profitable to AMD. As a reference, between 2008 and 2011 when ATI/AMD had the biggest technological lead over Nvidia's disaster architectures, even then when AMD was at near 50% market share it merely posted 19M of profits across 3 financial years! In the same time frame, despite terrible performances, Fermi architecture already going into the 400w consumption range, even then Nvidia posted billions of profits across the same time frame. AMD has simply stopped competing with Nvidia on prices, it's nonsense to them. Nowadays both Nvidia and AMD sell more GPUs to datacenters and super computers, where net margins are also twice as high than they do to gamers. Essentially both AMD and Nvidia are abandoning the gaming aspect of their hardware, stopped competing price-wise, instead they prefer both to sit on higher margins in the gaming market and focus on GPGPU aspect for business, research, automotive, AI, etc, etc, where the real money and growth is. The fact that this hardware is also able to crunch rendering calculations is more and more of a side effect.
- hoseja 4y ago
  We need games that utilize local neural nets.
  - mepian 4y ago
    It seems that DLSS/XeSS is the only feasible application of local neural nets to games right now, everything else is too compute-hungry.
- pdpi 4y ago
  AMD has notably cornered the console market with the Xbox One and Series X|S, PS4 and PS5. With the Steam Deck and now the Asus ROG Ally, they're starting to get themselves a position in the handheld market too.
  - themitigating 4y ago
    Is OEM integration profitable though? I would imagine Microsoft and Sony squeezed the best deal and maybe it will bring profit in later years when the research debt is paid
    - soganess 4y ago
      Judging by their conservative clocks and odd configurations (ex steam deck is a 4-core) these are some of the lower bind parts that would otherwise not be high-value final products on the open PC market. Perhaps even "defective" (ex failed PCIe lanes) in some way that makes them useless. I always figured this was a "use the whole pig" situation.
  - epolanski 4y ago
    Sure, but those aren't a company-defining revenues or where huge growth is.
- prettyStandard 4y ago
  This isn't entirely make sense to me, I thought AMD was very far behind on GPGPU. Do these supercomputer and data center projects use things like ROCm and OpenCL, and solve the software issues on their side? Does AMD compete on price there?
meltyness 4y ago
Intel doesn't really have a competing product. AMD and Nvidia sell the same thing made at the same place in Taiwan. Nvidia dove in like 1998. AMD sold it's moat in like, 2005.
reissbaker 4y ago
Contrary to what other posters are saying, I do think AMD is actually trying to compete; for example, they finally gave up on OpenCL and are trying to play catch-up to Nvidia via ROCm, effectively allowing you to run CUDA on AMD's server GPU offerings. And on the gaming side their top-of-the-line offering, the 7900 XTX, is ~$600 cheaper (aka 60%!) at MSRP than Nvidia's top-of-the-line RTX 4090 — and the prices you'd pay from e.g. resellers on eBay are even more skewed towards Nvidia. That being said, they're just way, way behind. Nvidia can charge what they do simply because AMD isn't great at making GPUs. In gaming AMD never caught up to Nvidia's raytracing perf, and AMD's attempt to clone DLSS is significantly less performant. Meanwhile in AI/ML the industry consolidated around CUDA because OpenCL was never that great, and — Nvidia owning the standard, and having built around it for over a decade, gives them a really big advantage. Plus, every GPU sold in the last decade+ by Nvidia supports CUDA, whereas only the new server GPUs from AMD support ROCm. Nvidia has executed incredibly well for decades: they pioneered shader programming, CUDA, raytracing, and DLSS. Arguably they even invented the GPU itself with the GeForce 256 in 1999 (as opposed to earlier "accelerator" cards). I struggle to think of anything AMD has done in the GPU space that matches even one of those accomplishments... Their only slight win is having OSS drivers for Linux, but honestly, that doesn't sell a whole lot of GPUs. AMD caught up to Intel on the CPU side in part thanks to Intel's failures. Nvidia just hasn't fumbled. Edit: Also, Intel is trying to edge their way into the GPU market as well with their Arc line of discrete GPUs, which is relatively affordable. They compete well on price, especially at the lower end: the A750 and A380 obliterate anything at their price points ($239 and $119, respectively). But, well, "at their price points" is a pretty critical part of that sentence. Their top-tier card, the A770, can barely eke out wins against the lower end of Nvidia's last-gen cards. And re: 2008-2011 ATI comparisons from a sibling comment — by 2010 Nvidia's Fermi architecture was reliably beating ATI again, albeit with higher power draw, and in 2007 they had just launched CUDA which ended up being the most lucrative market segment for GPUs. In retrospect I think Fermi was much less of a flop than it seemed (and it was a fairly brief one compared to Intel's CPU woes).
- nl 4y ago
  ROCm development is understaffed and continually considerably behind CUDA too.

metaphor 4y ago

Agreed. At this point, it's clearly artificial GPU scarcity. We felt it early in consumer staples[1], and the grifting by auto dealers wasn't imagined either[2]...I won't even bother with the housing market to preserve my sanity. GPUs are really no different. Consumers need to wake up and smell the underlying meta[3]. [1] https://www.bls.gov/opub/btn/volume-12/measuring-shrinkflation-and-its-impact-on-inflation.htm https://www.bls.gov/opub/btn/volume-12/measuring-shrinkflati... [2] https://www.bls.gov/opub/mlr/2023/article/automotive-dealerships-markups.htm https://www.bls.gov/opub/mlr/2023/article/automotive-dealers... [3] https://scholarworks.umass.edu/econ_workingpaper/343/ https://scholarworks.umass.edu/econ_workingpaper/343/

epolanski 4y ago
Not only artificial GPU scarcity. It is obviously clear that AMD and Nvidia are deliberately avoiding fighting each other on prices, something they got punished for in 2008, except that at the time it was done in secret meetings, now it's literally AMD playing alone and avoiding to compete completely on price.
- jacooper 4y ago
  They compete on price, just not as much as before The 7900xtx is much better deal at 1000$ than 1200$ for the 4080, yet and isnt pushing prices as low as they used to. The difference is AMD actually discounts old GPUs and CPUs, a 6950XT can be found for around 500$ or less.

MrBuddyCasino 4y ago

As long as both have unsold inventory of their older architectures, they will not lower prices of the current generation, and they won't enter a price war. Intel's next generation might be able to exert some pressure, but by then AMD and Nvidia will probably have cleared their old inventory anyway.

chiph 4y ago

I am running on an ancient GTX 1070 and would like to upgrade to an RTX capable card, but there's no way I'm paying the current prices. I'm not sure why the prices remain high, after the crypto crash and pandemic shortages have eased. Cost of the Nvidia license? Cost of materials + production? Unrealistic profit projections? Probably a mix of all three.

dontlaugh 4y ago
Same. I'm sticking with my even more ancient 970, it'll do for a while longer.