[coward8675309]

The paranoid conspiratorial tone of TFA is a symptom of what's wrong with the Internet and therefore humanity:

> The big brands that are ultimately at stake (Sony, Microsoft, NVIDIA, AMD) all talk about “demand exceeding supply”. Oh, really? [New paragraph.] It is a rather evasive explanation, without any communication about the actual state of their supply and production lines…

The dark secret? Not only is demand GREATER THAN supply, but supply is — wait for it! — LESS THAN demand! OMG, they've been covering this up the whole time! And not only that, current events and world affairs are contributing to this situation! When will the sheeple wake up?!

[colejohnson66]

You mentioned this briefly, but: I think the big problem is the stay-at-home orders combined with massive improvements in technology results in tons more people wanting to upgrade immediately than initially expected (based on previous releases).

It wouldn’t make sense for Nvidia to produce less than the demand on purpose because that results in less money. If we take the view of companies want to maximize profit, it would make sense that they’d try to fulfill demand. Another big problem is scalpers and websites not doing enough to stop it. They create an artificial scarcity so they can make a quick buck. Sure, a PS5 isn’t “essential” like toilet paper is, but it’s still a dick thing to do.

[rob74]

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, so the scalpers profit...

[vlovich123]

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 MSRP to $800 after they’ve sold out because then they’ve made even less money.

So your job now is to figure out what the scalp price will be in the future before there’s any demand.

Additionally, please factor in your pissed off customers who paid you $800 for launch day delivery for the price to potentially drop to $400 a few months after. What’s the cost of that brand damage?

Scalpers have numbers (if demand and supply are close, they have an artificial power to restrict it) and power (the OEMs have to tread a delicate line with many constituencies that scalpers don’t since you “blame” scalpers but that doesn’t hurt anyone’s actual reputation).

For all we know scalpers are part of the business plan. NVidia gets record sales numbers and press articles about how the GPU is sold out. All the OEMs offer preferential access to buy the GPUs giving them better margins, getting rid of inventory, and no reputation risk beyond at worst some marginal grumbling that they’re not doing enough to stop scalpers. The only ones getting screwed are early adopters who are eager to pay higher prices.

It’s the perfect way to segment the market by price sensitivity without paying for it or running afoul of any laws if it’s being done intentionally.

[stale2002]

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?

[cartoonfoxes]

Clever, I like this. Doubtless I'm sure I'm about to read followups telling me why this won't work, which I look forward to reading.

[cbozeman]

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.

[tylerhou]

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.

[p1mrx]

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.

[thaumasiotes]

> 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

Just to be clear, you cannot contractually obligate a vendor to sell your product at the MSRP. (Or any other price.) That's the whole reason the term is "manufacturer's suggested retail price".

[roenxi]

> ...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.

[mschuster91]

> 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 the ordinary worth.

In concert and other event tickets it's even worse. Some tickets have been known to sell at 20x markups, Rammstein concerts or Wacken tickets are usually outsold in a matter of hours and end up on ebay the day after.

[cbozeman]

> In concert and other event tickets it's even worse. Some tickets have been known to sell at 20x markups, Rammstein concerts or Wacken tickets are usually outsold in a matter of hours and end up on ebay the day after.

That's because there's built-in scarcity by virtue of physical limitations of a venue.

If your stadium only holds 15,000 people, but your city has 11 million or more like, say, the Dallas-Fort Worth metroplex, you can easily find 15,000 metalheads. Probably an order of magnitude more.

People keep talking about "artificial scarcity" with these GPUs, but its not artificial. The foundries that make these are running at max capacity 24/7. They are trying to get these cards into the hands of the people that want them, there's just simply not enough foundries and capacity available.

There isn't some grand conspiracy in this case. In this case, this is the effect of increasing consolidation of the computer industry as a whole.

Look back the 1980s at the amount of hard disk manufacturers. There were easily 10+ companies... Western Digital, Seagate, Connon, Maxtor, Quantum, etc. Now what are there? Three? Seagate, Toshiba, and Western Digital?

[BlueTemplar]

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" themselves for the medical workers, by not only requisitioning masks, but also making propaganda about how masks weren't effective!)

[mschuster91]

> 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).

[BlueTemplar]

I guess what they could do is to sell concert tickets as named lottery tickets, that way :

- they can keep the price of an individual ticket relatively cheap

- fairness is preserved

- they probably would still get more money than now, while scalping would be basically infeasible

[coward8675309]

I spent $600 on a PS2 from an eBay-based scalper in 2000. I can only imagine how much more organized and pervasive the practice is twenty years later.

[colejohnson66]

Easy access to code to run your own bot doesn’t help. In 2000, the internet was pretty new, but now, YouTube exists and can teach anyone to set up their own bot for a chance to “get rich quick!”

[coward8675309]

I haven't looked, because I would get too depressed, but I'm sure YouTube contains videos teaching people how to get rich quick by creating videos that teach people how to get rich quick by…

[doublerabbit]

I'm already watching YouTube videos of 16 year olds teaching me things related to what I was teaching when I was 16. It's depressing.

[raducu]

Just my own tin-foil observation: the prices of components in much demand tens to remain much higher than the original anounced price for years. Scalpers cannot account for that. Surely Nvidia is actually chatging premium prices as well and blames it on scalpers and unexpected demand. Nvidia just tricks the world with the low announced price, bates and then switches, realtors do that all the time.

[zamadatix]

There's some relevant backstory to understand what was said - Nvidia's CEO kicked off the RTX 3000 launch (which was the first of the recent chain of products that have been hard to get) by saying "The 3080 and 3090 have a demand issue, not a supply issue" and as you just pointed out this doesn't make any sense but here we are having to point out there are reasons in the world Nvidia can't produce enough GPUs since that sounds too negative for them to say outright for some reason.

Since companies have at least admitted there isn't going to be a lot of supply (some after reality actually hit them but at least they eventually said it) but still while dodging actually admitting it's simply because of the reasons in the article, hence the article.

I think it's a valid point and certainly not conspiratorial or what's wrong with humanity even if it wasn't.

[NoOneNew]

Yea, this also happens periodically, granted at lesser degrees. Incorrect projections, retooling, mundane management changes that HAVE to make their immediate mark on production and other crap. Given the ever so minor hiccups to the global supply chain we experienced throughout the year, on top of a plant catching ablaze... this isn't that surprising. This too shall pass.

[pilsetnieks]

I think you're overly simplifying the issue. The interesting part here is about why there are these supply issues - are there technical limitations, lack of manufacturing capacity, manufacturing difficulties, supply issues for source materials, transportation problems or costs, etc.