The costs of manufacturing will be pretty low. Initial pricing adds amounts in to try and recoup R&D costs. They will be have been recovered.
As production goes on, it gets better and therefore production costs decreases.
If you think nVidia can't reduce a £450~ product by £70 else they'll start making a loss, then you are absolutely suggesting that they are quite expensive to manufacture.
If you're suggesting that multiple parties take sell it on with a 20% margin, then you seem to be under the impression that these cost £200+ to manufacture.
When nVidia drops prices, they give rebates directly to their resellers. So they take the hit themselves. So money coming off the bottom is the best place for it be coming off as nVidia will be taking the largest slice of the sale cost anyway.
No I am suggesting that they will have a target % of mark up they need to recover per unit based on total expenditure including R&D, marketing, support etc. It isn't just the cost of manufacture. The total cost per unit though to cover the rest of the overheads on that product line need to be taken into account.
I worked for a company that produced an item that in raw material costs around £18 and we sold it for £110 a unit. However due to R&D, Marketing, Testing, Approvals required, Distribution, Support, Expected Damages/Loss the profit left was around £30 a unit and that was with us distributing direct. Now you then sell them via a third party distributor who want to take a cut but you can't price them higher than what you sell direct and by then we was left with a £15 profit per unit.
Now unit sales increased by them holding stock and having a larger distribution system in the UK than ourselves but it doesn't leave a lot. I think people under estimate how much everything adds up and what the cost is and how it breaks down on a per unit basis.
Now we take into consideration that currently it costs per unit £80 to do all that, leaving them £120 in profit per unit. Now you are on about taking £70 off that. £50 per unit then becomes quite a small number.
Of course the profit margins for the lower tier units are less and the higher tear units are more since a lot will be the same process with the same costs but just sold at a premium for having a better binned chip. Still profit is made by vast quantities of units sold not small quantities with high margins.
If you want the high margin profit then clothing, specifically items such as high end suits for instance can have huge markups. Where my mother used to work they often had a mark up of around 500%.
Side note: Other notable mark up items;
Popcorn in a theater, their mark up can be 1000% onward
Prescription drugs that are between 500-3000%
The cost of a text message equates to 6000% mark up on pay as you go
The tech market though is not a high markup place.
