EVGA terminates relationship with NVIDIA

humbug · 18 Sep 2022 at 14:03

Joxeon said:
Nvidia produce the chips, AIBs are like the middlemen so it makes sense buying direct from Nvidias FE range is cheaper. Pretty sure its the same for a lot of industries.

You can also increase your margins by cutting out the middle man, or middle men, a distributor would also take their cut as well as AIB's for their own cooler / board designs.

It can be good if those cost savings are passed on to the consumer, and it would seem currently that's what Nvidia are doing, the FE cards are cheaper, 3090 FE $1,100, EVGA are losing money on a $1,300 3090.

Thing is tho AIB's serve another purpose, competition, Nvidia's conscious choice to compete with their own partners says they don't care about them, that at least, it could even be Nvidia are trying to push them out of the supply chain because like Apple they want to be the only ones selling thier own vertion of their product, and i just don't think that's good news for the cost of them once Nvidia have done away with what they clearly see as their competition.

gpuerrilla · 18 Sep 2022 at 14:08

The issue relying on FE purchasing is they are limited. They drop in waves which although we are used to now, pandemic or mining aside it has always been a fight to obtain one. Now the scalpers are hot on this expect lack of them for a while.

The easier decision to ignore FE cards was years ago they were poor build quality.

humbug · 18 Sep 2022 at 14:14

gpuerrilla said:
The issue relying on FE purchasing is they are limited. They drop in waves which although we are used to now, pandemic or mining aside it has always been a fight to obtain one. Now the scalpers are hot on this expect lack of them for a while.

The easier decision to ignore FE cards was years ago they were poor build quality.

Right, its not easy to ignore them now, FE cards are very nice, very Apple like...

Made by the same company that make iPhones.

Nexus18 · 18 Sep 2022 at 14:17

Joxeon said:
Nvidia produce the chips, AIBs are like the middlemen so it makes sense buying direct from Nvidias FE range is cheaper. Pretty sure its the same for a lot of industries.

Exactly, which could be big trouble for amd as it will give nvidia the option to be able to drastically reduce prices whilst still making a killer margin "if needs be"....

Ultimately I wouldn't be surprised if we see nvidia gradually get rid of AIBs as they are very much like apple and I imagine that is nvidias goal to be even more like apple given they are worth what now, over a trillion? Apple and nvidia are very similar in some of their traits:

- closed source solutions
- don't have anyone to compete with really, apple don't really consider android to be competing as different ecosystems etc. obviously nvidia have amd but well given the market share, it's almost a monopoly and unless amd start gaining market share, I don't think nvidia are really that worried
- nvidia seems to be going down the "ecosystem" path with things like geforce now, experience, shield and I imagine they'll come up with more ways of locking people in, which will allow them to monetize these platforms/features (which is what they want as that is where the bulk of the money is these days as Microsoft and Sony have recently learned)

humbug said:
You can also increase your margins by cutting out the middle man, or middle men, a distributor would also take their cut as well as AIB's for their own cooler / board designs.

It can be good if those cost savings are passed on to the consumer, and it would seem currently that's what Nvidia are doing, the FE cards are cheaper, 3090 FE $1,100, EVGA are losing money on a $1,300 3090.

Thing is tho AIB's serve another purpose, competition, Nvidia's conscious choice to compete with their own partners says they don't care about them, that at least, it could even be Nvidia are trying to push them out of the supply chain because like Apple they want to be the only ones selling thier own vertion of their product, and i just don't think that's good news for the cost of them once Nvidia have done away with what they clearly see as their competition.

There we go, finally answered one of the questions at long last, that wasn't so hard now was it.

Joxeon · 18 Sep 2022 at 14:19

humbug said:
You can also increase your margins by cutting out the middle man, or middle men, a distributor would also take their cut as well as AIB's for their own cooler / board designs.

It can be good if those cost savings are passed on to the consumer, and it would seem currently that's what Nvidia are doing, the FE cards are cheaper, 3090 FE $1,100, EVGA are losing money on a $1,300 3090.

Thing is tho AIB's serve another purpose, competition, Nvidia's conscious choice to compete with their own partners says they don't care about them, that at least, it could even be Nvidia are trying to push them out of the supply chain because like Apple they want to be the only ones selling thier own vertion of their product, and i just don't think that's good news for the cost of them once Nvidia have done away with what they clearly see as their competition.

Even through the height of the price gouging Nvidia kept their products at MSRP, it was the AIBs who were charging silly prices. Nvidia probably took note of this since as you keep saying Nvidia sets the ceiling and clearly this wasn't being adhered too so now Nvidia wants some of those profits back.

humbug · 18 Sep 2022 at 14:29

Joxeon said:
Even through the height of the price gouging Nvidia kept their products at MSRP, it was the AIBs who were charging silly prices. Nvidia probably took note of this since as you keep saying Nvidia sets the ceiling and clearly this wasn't being adhered too so now Nvidia wants some of those profits back.

Its also Nvidia who set the price AIB's pay for these GPU's, and how much they sell the end product for.

Nvidia may well be making a profit on a $1,100 FE 3090, but EVGA are losing money on a $1,300 3090 of their own design, when asked if those loses were in the "100's" the answer was yes.

Either its that the board and cooler is adding many 100's to the cost of that end product or Nvidia are charging amounts for those GPU's that are so high its impossible to make any money on them after also adhering to Nvidia's pricing cap, if nothing else that is a toxic power dynamic.
AIB's margins have gone from 25% to 5% in the same period that Nvidia's have gone from 38% to 65%, on top of that EVGA are not the only board partners that are telling tech journalists Nvidia are charging too much.

You take all of that in to consideration it does seem like Nvidia see their own partners as competitors and are using attrition tactics to push them out of the supply chain.

Ross Thomson · 18 Sep 2022 at 14:37

humbug said:
Its also Nvidia who set the price AIB's pay for these GPU's, and how much they sell the end product for.

Can't do that in EU.

humbug · 18 Sep 2022 at 14:39

Ross Thomson said:
Can't do that in EU.

I didn't know that but the EU is just one small (relative) part in a global supply chain.

Joxeon · 18 Sep 2022 at 14:40

humbug said:
Its also Nvidia who set the price AIB's pay for these GPU's, and how much they sell the end product for.

Nvidia may well be making a profit on a $1,100 FE 3090, but EVGA are losing money on a $1,300 3090 of their own design, when asked if those loses were in the "100's" the answer was yes.

Either its that the board and cooler is adding many 100's to the cost of that end product or Nvidia are charging amounts for those GPU's that are so high its impossible to make any money on them after also adhering to Nvidia's pricing cap, if nothing else that is a toxic power dynamic.
AIB's margins have gone from 25% to 5% margins in the same period that Nvidia's have gone from 38% to 65%, on top of that EVGA are not the only board partners that are telling tech journalists Nvidia are charging too much.

You take all of that in to consideration it does seem like Nvidia see their own partners as competitors and are using attrition tactics to push them out of the supply chain.

They are losing money now but they were making a boatload of cash when the cards were selling for 3x the msrp.

Imagine how Nvidia felt when they were selling a 3080FE for £650 and then see AIBs charging £2000 for the same card so its not surprising that now prices have crashed that Nvidia isn't cutting them any slack.

They screwed Nvidia and now Nvidia is screwing them back.

humbug · 18 Sep 2022 at 14:44

Joxeon said:
They are losing money now but they were making a boatload of cash when the cards were selling for 3x the msrp.

Imagine how Nvidia felt when they were selling a 3080FE for £650 and then see AIBs charging £2000 for the same card so its not surprising that now prices have crashed that Nvidia isn't cutting them any slack.

They did sell these cards for $3,000, i remember it, Nvidia obviously allowed them to do that at the time, but during that time AIB margins fell from 8% to 5%, so where did that money go? well Nvidia's margins were the only ones that grew. So i dread to think what AIB's were paying for those dies in that period.

gpuerrilla · 18 Sep 2022 at 14:45

Joxeon said:
Imagine how Nvidia felt when they were selling a 3080FE for £650 and then see AIBs charging £2000 for the same card so its not surprising that now prices have crashed that Nvidia isn't cutting them any slack.

I seen them retailing for ~£1200, I don't recall them selling 3080's for £2000 though. Are you sure about that?

humbug · 18 Sep 2022 at 14:45

gpuerrilla said:
I seen them retailing for ~£1200, I don't recall them selling 3080's for £2000 though. Are you sure about that?

In the US, yes.

gpuerrilla · 18 Sep 2022 at 14:49

humbug said:
In the US, yes.

We dont buy from US retailers though.. but if that's the case whilst it went on then, due to the stronger dollar at the moment they seem to have better consumer purchase prices that we have. The hardware right now is much cheaper to buy as a US consumer, just look at the consoles here being bumped up £50 where over there it stayed the same.

humbug · 18 Sep 2022 at 14:51

gpuerrilla said:
We dont buy from US retailers though.. but if that's the case whilst it went on then, due to the stronger dollar at the moment they seem to have better consumer purchase prices that we have. The hardware right now is much cheaper to buy as a US consumer, just look at the consoles here being bumped up £50 where over there it stayed the same.

The weak £ is a problem for us right now, yes, $1,15, that is less than the VAT we add on top, thank you Mr Osborn "the party of low taxes" :rolleyes:

V F · 18 Sep 2022 at 15:02

Was the first Founders Edition 2016? The 10 series? Or was it 980...

gpuerrilla · 18 Sep 2022 at 15:04

As long as AMD and nvidia have a UK reseller for the new gen it wont be an absolute disaster like this gen ended up being. Most folk will be concerned about regular cost of goods and bills for the next while, will be surprised if high end gaming hardware flies off the shelves particularly after the market has had its frenzy over the past two years to use.

humbug · 18 Sep 2022 at 15:04

V F said:
Was the first Founders Edition 2016? The 10 series? Or was it 980...

ya, this. Maxwell was just "reference"

TrixP10 · 18 Sep 2022 at 15:10

humbug said:
Nvidia sell the GPU dies to AIB's, for whatever they ###### like, Nvidia also set how much AIB's can sell the end product for.

With that in mind Nvidia's margins have gone from 38% to 65%, during the same period AIB's margins have gone from 25% to 5%.

AIB's have been complaining to tech journalists that Nvidia are charging too much for their GPU's, Nvidia's principle partner have quit Nvidia.

And some of you guys are still trying to shift the blame away from Nvidia on to suffering AIB's? What has Jenson done for you to deserve that level of loyalty?

Exactly. This fiasco and previous dodgy business practices makes me wonder why people rush to be screwed over. Maybe they are just blind.

V F · 18 Sep 2022 at 15:10

humbug said:
ya, this. Maxwell was just "reference"

Bizarre, it doesn't feel that long ago. Yet it felt as if they've been around a while.

DeliciousStorage · 18 Sep 2022 at 15:10

ColdAsIce said:
Unless that affected every single 3070 TI Fe, then it's just a bit of bad luck. What about the state of the original MSI 3080 release with the awful power connectors that were breaking or not fully connecting to the PSU?

I believe it did affect every single 3070 TI FE that was used at 100% load. In this review temperatures went up to 82c, if you put it in a closed case or in a slightly warmer room that will add a few degrees. After several minutes mine would reach 85-86c at which point the clocks would fluctuate between 1760MHz-1800MHz due to thermal throttling. The cooler simply wasn't good enough and AIB cards are still way ahead in temperature and noise levels.