Why are GPUs so expensive?

TNA · 7 Nov 2019 at 09:23

BUDFORCE said:
I dunno, I'm not sure they've gone up that much, I bought an sapphire ATI x1800xt not long after release, and I think that was £200 odd quid then, and it wasn't quite the top, the x1900xt was, anyway add 14 years of inflation....

Inflation calculator says that about £300 equivalent.

I dunno it might have been more than £200 it was 14 odd years ago.

I guess they have gone up a bit, the other thing is maybe PC gaming is becoming a little more niche?

Maybe as third world countries develop more they want to get paid more so things like this will cost more.

I think they sell a lot more now then they did back then actually. Don't have the numbers for this, but pretty sure that is the case.

As I said, main issue is they have much bigger profit margins. If this was not the case then why are they making record profits relative to 10 years ago?

Chrisc · 7 Nov 2019 at 10:34

Timbjpen said:
Because of greed and oriental cost of prostitution and more greed mixed with hookers from the people at the top!

Remember you chumps/geek boys cause this

Timbjpen said:
Gotta blame AMD as well for hiring special needs people from the 70s

Are you ok hun?

TNA · 7 Nov 2019 at 11:03

Chrisc said:
Are you ok hun?

Lol

LePhuronn · 7 Nov 2019 at 12:07

Timbjpen said:
Because of greed and oriental cost of prostitution and more greed mixed with hookers from the people at the top!

Remember you chumps/geek boys cause this

Timbjpen said:
Gotta blame AMD as well for hiring special needs people from the 70s

If you're going to troll, at least make sense.

Chrisc · 7 Nov 2019 at 12:09

LePhuronn said:
If you're going to troll, at least make sense.

That is how people running 'intel HD' graphics communicate.

LePhuronn · 7 Nov 2019 at 12:15

Chrisc said:
That is how people running 'intel' communicate.

Fixed it for you

#alsotrolling

Chrisc · 7 Nov 2019 at 12:48

LePhuronn said:
Fixed it for you

#alsotrolling

oooohhhh Shots fired!

varkanoid · 7 Nov 2019 at 13:09

BUDFORCE said:
I dunno, I'm not sure they've gone up that much, I bought an sapphire ATI x1800xt not long after release, and I think that was £200 odd quid then, and it wasn't quite the top, the x1900xt was, anyway add 14 years of inflation....

Inflation calculator says that about £300 equivalent.

I dunno it might have been more than £200 it was 14 odd years ago.

I guess they have gone up a bit, the other thing is maybe PC gaming is becoming a little more niche?

Maybe as third world countries develop more they want to get paid more so things like this will cost more.

x1800xt 512mb! $549 (£270) (2005)
https://www.cnet.com/reviews/ati-radeon-x1800-xt-512-mb-review/

x1900xt 256mb $349 (£170) (2006)
https://bit-tech.net/reviews/tech/graphics/ati_radeon_x1900xt_256mb/1/

I had a 1800xt and I really wanted a X1900xt - I remember there was a massive difference between 256mb and 512mb models I think RAM was very expensive/scarce.

Maldoror · 7 Nov 2019 at 13:30

Human interest. Look at the number of posts on OcUK's forum and you'll see that Graphics Cards have the most. Add in the multipurpose intrigue of cryptomining and neural nets and you can see why Nvidia hope to shift once and for all the centrepoint of the PC from the CPU to the GPU.

Crypto & AI have served to make GPUs more than just a 'gaming tool' in the public consciousness, even that's still what we mostly use them for. The Crypto-craze also proved to Nvidia the new ceiling of price and what people were willing to pay for top end GPUs.

Having said that, however - in 2000 I had a Geforce 2 Ultra, which with inflation works out to only slightly less than a cheap 2080Ti.

I think 2020 will see more competitive pricing in the GPU sector thanks to Intel throwing their hat into the ring. I doubt they'll go straight for the top end but the 2060S market and below should be fiercely fought. Let's hope, anyway.

LePhuronn · 7 Nov 2019 at 14:35

Maldoror said:
I think 2020 will see more competitive pricing in the GPU sector thanks to Intel throwing their hat into the ring. I doubt they'll go straight for the top end but the 2060S market and below should be fiercely fought. Let's hope, anyway.

Not gonna happen. Nvidia set stupidly high prices, AMD played along and inflated their own prices because the market allowed it. Why would the same company who charges £600 for a rebadged 8 core with more holes than Swiss cheese suddenly undercut competitors if a market allows high prices?

The only thing that will correct prices are those idiot consumers who just open their wallets without thinking and take one without lube like it's some kind of privilege.

Freddie1980 · 7 Nov 2019 at 14:50

AMD are just as bad ad Nvidia. Who remembers when AMD launched the RX 480 and the proudly stated it would cost from $200? Fast forward to 2019 and it's replacement the 5700 XT costs $400+!

I use to care about this but these days I've accepted there's nothing I can do about it and others want to go ahead and part £400/£500 for a mid range card then let them and I'll buy 2nd hand off the bay and save a ton of cash.

subbytna · 7 Nov 2019 at 14:51

The "must have the top tier card for my forum e-peen" idiots keep buying them so Nvidia has no reason to reduce their prices. Nvidia started it with the Titan cards. Pushing out a £1k card to see if there were any that would bite....they caught a few whoppers and lo and behold, persistent high priced cards. It's not going to change any time soon.

BUDFORCE · 7 Nov 2019 at 15:01

Thing is price per performance doesn't scale evenly at the top end, you are literally paying a massive premium just to have the best. For a relatively small drop in performance you'll get much more bang for buck going somewhere between mid and top range.

Same thing applies to all PC hardware really.

D.P. · 7 Nov 2019 at 16:03

TNA said:
The thing is though mate, looking at their financials, you can see they are making more profit per sale now then they did before. So a lot of it is mainly that.

Same with mobile phones, the cost of making is nowhere near the price they charge. But they charge it as people are happy to pay. You can see this as their share price soars...

That is why I do not take too seriously when people say the cost of R&D is going up etc. Sure it is, but not that much for them to increase prices like they have. Most of it is just profit.

This is false:
https://www.macrotrends.net/stocks/charts/NVDA/nvidia/profit-margins

Operating margin is currently 20%,the same it has always been. You can see the 2008 crash, and the 2017 bitcoin craze. Otherwise it id a solid 20% . This is despite nvidia selling more higher margin products for deep learning and HPC.

Costs to produce s large chip ln each new process are trippling each generation. Nvidis spent more on Turning R&D than all the GPUs up to Maxwell combined.

Nasher · 7 Nov 2019 at 16:27

Freddie1980 said:
AMD are just as bad ad Nvidia. Who remembers when AMD launched the RX 480 and the proudly stated it would cost from $200? Fast forward to 2019 and it's replacement the 5700 XT costs $400+!

I use to care about this but these days I've accepted there's nothing I can do about it and others want to go ahead and part £400/£500 for a mid range card then let them and I'll buy 2nd hand off the bay and save a ton of cash.

The 5700 isnt the replacement for the 480. That's the 580, which is still in production.

greatash · 7 Nov 2019 at 16:34

Nasher said:
The 5700 isnt the replacement for the 480. That's the 580, which is still in production.

580 was just a small refresh. 5700 should have replaced Polaris, while 2060/2070 should have replaced 1060/1070. Instead they replaced Vega and 1070ti/1080.

Just look at the die sizes, they're the typical mid range cards but with next tier up prices. 2070 is a tu-106 chip, in the past tu-106 was always the 60 card.

Nasher · 7 Nov 2019 at 16:43

greatash said:
580 was just a small refresh. 5700 should have replaced Polaris, while 2060/2070 should have replaced 1060/1070. Instead they replaced Vega and 1070ti/1080.

Just look at the die sizes, they're the typical mid range cards but with next tier up prices. 2070 is a tu-106 chip, in the past tu-106 was always the 60 card.

Not sure it's a Vega replacement either since it's only GDDR ram and not HBM2 (HBM2 being much more expensive).

Freddie1980 · 7 Nov 2019 at 16:43

Nasher said:
The 5700 isnt the replacement for the 480. That's the 580, which is still in production.

It is though, the 256bit memory bus which is the give away. The upcoming 5500 cards use a 128bit bus are the $200 replacement and offer up more or less the same performance so in 4 years the goal posts for cost to performance has barely moved at this end of the market.

leon4112 · 7 Nov 2019 at 16:54

Also im not defending it but R&D costs and such are a lot more than they used to be for example below, that doesn't include memory costs have risen a lot from ddr/ddr2 its just the way IT related kit has gone I myself don't mind spending £500 over 3-4 years for a card.

NVIDIA Annual Research and Development Expenses
(Millions of US $)
2019 $2,376
2018 $1,797
2017 $1,463
2016 $1,331
2015 $1,360
2014 $1,336
2013 $1,147
2012 $1,003
2011 $849
2010 $909
2009 $856
2008 $692
2007 $553

TNA · 7 Nov 2019 at 17:05

D.P. said:
This is false:
https://www.macrotrends.net/stocks/charts/NVDA/nvidia/profit-margins

Operating margin is currently 20%,the same it has always been. You can see the 2008 crash, and the 2017 bitcoin craze. Otherwise it id a solid 20% . This is despite nvidia selling more higher margin products for deep learning and HPC.

Costs to produce s large chip ln each new process are trippling each generation. Nvidis spent more on Turning R&D than all the GPUs up to Maxwell combined.

Looks like net profit margin has at least doubled to me? Crypto boom ended ages ago, does not apply to 2019 results? Yet as you can see a huge spike in profits...