Caporegime
- Joined
- 9 Nov 2009
- Posts
- 25,462
- Location
- Planet Earth
I think you are right, in that they probably won't reduce MSRP, not until the 50 series anyway. And I also think that discussing why they have done this is pointless, but this is not good business, it's very bad business. At the very least they have failed to present good reasons for the price increases to the experts and gamers alike. A graphics card is an essential product for the PC but NVIDIA are trying to turn it in to a luxury product. You can't just SAY it's a luxury product and expect the people to buy it. You have to earn that tag and NVIDIA certainly have not.
Because there is a obsession of the stock market over short term margins,even over actual revenue. In August their gaming revenue was down 1/3 compared to the same period a year ago,and they had to write off $1.32 billion! They could have decreased pricing and sold far more of the Ampere stock,but that would reduce margins.
This is the weakness with this obsession of the stock market over short term margins,it's actually more damaging in the longterm. Everything is run too leanly,with no backup plan, to maximise short term margins. Just look at the energy market in Europe for example - no back up plan and governments are quite happy to join in helping them out.
Ultimately the tech industry overpromised to investors they would see the same sort of growth they saw over 2020 and 2021 for the next few years. Now they have to keep to that promise at all costs. This is why Nvidia despite ripoff pricing is screwing over its AIB partners.
Too much of this price escalation has been driven forward by excessive money printing,and cheap credit since the 2008~2009 Financial Crisis. As the belts tighten with consumer spending and borrowing,it is going to start causing problems for the tech bubble over the next few years. But if governments start reducing Quantitative Easing and start to try and reduce the amount of money in circulation a lot of tech companies are going to find things harder.
The entitlement complex of the tech industry over the last decade is going to end up in a very hard landing,if they don't enter some sort of reality. You can't just base endless margin growth on endless Fiat money printing and endless borrowing!
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