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When important components become scarce: CPUs, GPUs

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Re: When important components become scarce: CPUs, GPUs

#81

Post by roenxi »

vlovich123 wrote: post #41
rob74 wrote: post #35

Earlier quoted context omitted.

Scalpers aren't powerful enough to create an artificial scarcity. If there were not really an increased demand for the products, noone would pay their inflated prices. When demand outstrips supply, the logical thing for manufacturers and (e-)retailers to do would be to increase prices themselves to balance out the situation, but for various reasons (one of which is possible negative PR) they are reluctant to do that,…

Your argument seems to be scalpers don’t have power because OEMs could just raise the price themselves and get all that scalp profit. That’s good in theory but in practice you have complex sales channel configurations and contractual agreements. If Best Buy is selling your GPU at $400 because that’s the agreed upon MSRP, they’re going to be pretty unhappy if they’re out of stock and suddenly you decide to increase MS…

> ...but in practice you have complex sales channel configurations and contractual agreements...

If simple makes more money these companies can do simple. Every company has a small group of people who can make things happen quickly (which is a couple of months in a big corporation). A price change from $400 -> $800 is going to get their attention.

It seems to me more likely that the reason for a slow response response is that the governments of the world seem to hate change and will likely penalise companies for responding quickly to extreme market signals. The safe way to do it is to release a 'new' product at a vastly inflated price. Basically that is just working around cognitive biases but it works.

The point about scalpers being part of the business plan gave me a few moments of thought; thanks for that.

Re: When important components become scarce: CPUs, GPUs

#82

Post by redisman »

vmchale wrote: post #12
kzrdude wrote: post #8

I'd like to hear more from companies, not consumers, that can't get the computers they want. How do they manage? More reuse? I traded up my computer at work, but it turns out they had to give my old one to a new employee due to shortages.

I don't know if this counts but I want an ARM laptop performant like the M1 but with Linux (not from Apple?)

No one else has access to TSMC 5nm so you won't find one. Not to even get to who would have Apple-caliber chip designers.

Re: When important components become scarce: CPUs, GPUs

#83

Post by Tarsul »

theandrewbailey wrote: post #36
monkeydust wrote: post #2

If (like me) your on a long waiting list to get a new Nvidia GPU or AMD processor this piece sheds some light on the issue from a supplier perspective.

I wanted a new GPU so I could run Cyberpunk 2077. Turns out that even people with those GPUs are having issues, so by the time I find one, the game should be sufficiently patched. I have a massive Steam backlog, so I'm not too frustrated.

huh, strange. I would have thought it runs alright on PC especially since I had no trouble whatsoever with my Radeon RX470 (2016), running on the preferences that the game gave me (more or less middle of the road with a solution of 2560*1440).

Re: When important components become scarce: CPUs, GPUs

#84

Post by cogman10 »

Animats wrote: post #69

It's a real problem. There's a worldwide shortage of high-end fab capacity. That's not an easy business to enter. TSMC is spending US$20 billion on their newest fab. They started in 2018, and they expect to get parts out in volume in 2021 or 2022. If you want to duplicate TSMC, you'd need a huge amount of money. TSMC is valued at around US$500 billion. Anyone not already a major fab operator would probably fail. They…

I suspect this problem is only going to get worse.

Each node shrink has come at incredible costs and there does not look to be any path towards decreasing those costs.

Eventually, there's simply going to be no ability to shrink. After all, we have a lower limit of single atoms. They have a radius of around 0.06 -> 0.5 nm. That's not terribly far from the current state-of-the-art processes of 7nm. Further, I doubt we'll ever get to that level in the first place without some really clever engineering. The issue to solve is electromagnetic radiation will induce currents in surrounding conductive material.

I really don't know where the industry ends up going when we hit that brick wall. Different materials? More exotic CPU designs?

Who knows.

Re: When important components become scarce: CPUs, GPUs

#85

Post by p1mrx »

cbozeman wrote: post #56
stale2002 wrote: post #48

Earlier quoted context omitted.

So, I heard an interesting solution to the scalper price problem, where suppliers are unable to raise prices. What Nvidia could do is sell a special "doctors without border's edition" version of their graphics card, that is 500$ more expensive, and the extra money is donated. That way, the extra money goes to charity instead of the scalpers, and nobody can really complain about it, because what do you hate charity?

Interesting idea... but I'd only be interested if I could claim that $500 as a tax deduction. :) Otherwise I'd rather just wait for supply to become available and donate the $500 outright.

This would be for people who want to pay the market price, but who don't want to participate in scalping. If you'd rather wait, then you're not the target market.

I think AMD/NVIDIA are stupid (in a capitalistic sense) for selling their products well below market price, and leaving money on the table for scalpers to collect.

Re: When important components become scarce: CPUs, GPUs

#86

Post by mschuster91 »

BlueTemplar wrote: post #59
mschuster91 wrote: post #45

Earlier quoted context omitted.

> Scalpers aren't powerful enough to create an artificial scarcity. Of course they are. Back in ye olde days when GPU mining for bitcoin was still possible (basically, FPGAs were not widespread and ASICs not even on the horizon), the amount of people who bought out all usable GPUs and resold them on ebay was massive . It was almost impossible to get anything for months unless you were willing to pay many multiples th…

This must mean that these concert tickets aren't being sold at market prices to start with... Now, a much worse situation is for critical health products, like what happened with masks and hydroalcoholic gel during the start of Covid. Not surprising that the governments intervened and made scalping of that illegal, and relaxed some rules on their fabrication. (But on the other hand the governments did some "scalping"…

> This must mean that these concert tickets aren't being sold at market prices to start with...

The "market" is more than just the price of goods sold, it's always also the environment. Events have to at least show some level of affordability for the common man or public backlash occurs.

Hardly anyone would go to a soccer match if the starting price for the ticket was in the four-digit range, any band that dared to put up scalper-market prices as base prices would be flamed to death as "elitist" by the media and the fans alike. I mean, people are already claiming that Wacken has gone too elite and Rammstein sold out to the rich.

Also, politics would intervene because many venues have been built entirely or largely with taxpayer money or the operation is supported by taxpayer money (tax credits, public transport, public parking).

Re: When important components become scarce: CPUs, GPUs

#87

Post by m463 »

Animats wrote: post #69

It's a real problem. There's a worldwide shortage of high-end fab capacity. That's not an easy business to enter. TSMC is spending US$20 billion on their newest fab. They started in 2018, and they expect to get parts out in volume in 2021 or 2022. If you want to duplicate TSMC, you'd need a huge amount of money. TSMC is valued at around US$500 billion. Anyone not already a major fab operator would probably fail. They…

Wouldn't this barrier to entry apply to any industry with high capital costs?

Container shipping, aircraft manufacturing, maybe tesla.

Re: When important components become scarce: CPUs, GPUs

#88

Post by benlivengood »

lucb1e wrote: post #71

At the risk of asking a stupid question: why have queues instead of raising prices until demand gets nearer to the level of supply? Not that I would want this of course, but I'd also want free bubble gum and the gum companies... they're there to make money. Why not chip makers? I don't see auctioning systems popping up, I see people in in queues for a GPU, "out of stock" pages, and purchase quantity limits being impo…

Because there's a price war between Intel and AMD for CPUs and between AMD and nVidia for GPUs.

Even if they're sold out there will still be preorders and people will preorder the best value.

Re: When important components become scarce: CPUs, GPUs

#89

Post by Animats »

m463 wrote: post #87
Animats wrote: post #69

It's a real problem. There's a worldwide shortage of high-end fab capacity. That's not an easy business to enter. TSMC is spending US$20 billion on their newest fab. They started in 2018, and they expect to get parts out in volume in 2021 or 2022. If you want to duplicate TSMC, you'd need a huge amount of money. TSMC is valued at around US$500 billion. Anyone not already a major fab operator would probably fail. They…

Wouldn't this barrier to entry apply to any industry with high capital costs? Container shipping, aircraft manufacturing, maybe tesla.

Aircraft manufacturing, maybe. Only two companies in the world can make a good large jet airliner - Boeing and Airbus. It took Airbus 21 years of government support to get to the first good product. COMAC in China is now trying.

Container shipping has hundreds of players. Anyone who can afford a container ship can play.

There are lots of little car companies. China has a huge number of car makers.

Re: When important components become scarce: CPUs, GPUs

#90

Post by tylerhou »

cbozeman wrote: post #56
stale2002 wrote: post #48

Earlier quoted context omitted.

So, I heard an interesting solution to the scalper price problem, where suppliers are unable to raise prices. What Nvidia could do is sell a special "doctors without border's edition" version of their graphics card, that is 500$ more expensive, and the extra money is donated. That way, the extra money goes to charity instead of the scalpers, and nobody can really complain about it, because what do you hate charity?

Interesting idea... but I'd only be interested if I could claim that $500 as a tax deduction. :) Otherwise I'd rather just wait for supply to become available and donate the $500 outright.

I would think that you would not be allowed to deduct the full $500 because you are getting a service — the ability to "skip the line" and grab a graphics card. You can only deduce $500 - FMV of that service, which a reasonable person might say is the difference between the street price of the scalped non-DWB cards and the DWB cards.

If the street price of the scalped cards is higher than the DWB edition, then you would not be able to deduct anything.

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