Common graphics card costs have halved for the reason that begin of 2022
The typical value of a graphics card has successfully halved for the reason that begin of the 12 months. That is the findings from a 3DCenter (opens in new tab) piece digging into historic knowledge cribbed from Jon Peddie Analysis (opens in new tab) (paywall), and it highlights the huge change in GPU gross sales over the cryptomining/pandemic years, but additionally why Nvidia has discovered itself in such a severe predicament at present.
It is a very thorough evaluation of the uncooked numbers and, regardless of being native German, the Google translation nonetheless makes it very a lot price studying. Although I simply wished to drag out a few attention-grabbing factors that it raises.
We do although must caveat this with a bit of clarification round what these numbers really characterize; they are not the ultimate gross sales of playing cards to finish customers at retail, they’re the gross sales of graphics playing cards from producers into the retail channel itself. They’re additionally not going to be 100% correct, however nonetheless shut sufficient for us to have the ability to draw some conclusions.
The actual kicker from that is the typical promoting value (ASP) of playing cards going into these retailers. These numbers aren’t the vastly over-inflated greenback figures we have been used to seeing price-gouging resellers take pleasure in on ebay, they are not even taken into consideration right here.
And but, from a low of simply round $267 within the harmless occasions of across the center of 2019, the ASP of a GPU rose to a excessive of round $1,077 in the midst of 2021.
That is greater than a 300% improve on the common value in simply two years.
The explanations for the rise in graphics card costs, and the rise within the general quantity too, have been lined in depth over the past couple of years. However, in brief, it was the proper storm of elevated demand for tech as a result of pandemic lockdowns, associated disruption within the provide chain (opens in new tab), and an exponential improve within the profitability of crypto GPU mining by way of ethereum.
That meant miners would fortunately hoover up any spare graphics playing cards they might, and do it in bulk. However, extra importantly, the profitability of ethereum mining on the time meant they’d additionally pay any value.
That drove costs to the typical gamer via the roof too, and made it both very tough to purchase a card due to restricted volumes or due to an unreasonable price.
You may see from the numbers alone that the tipping level has occurred, the place provide is beginning to outstrip demand, and that the bubble has burst as ethereum edges ever nearer to the approaching merge (opens in new tab). That is the purpose the place it’s going to finish the usage of graphics card processing to energy the blockchain ledger, and that can possible happen within the subsequent few days, no less than that is what Google thinks (opens in new tab).
It’s price noting once more the dip in gross sales numbers pertains to gross sales of GPUs into the channels; that is taking place as a result of the retailers are beginning to realise they needn’t preserve shopping for graphics playing cards from producers, as a result of they have a bunch nonetheless sat within the warehouse and, with imminent next-gen releases, not all are going to promote.
They usually’re positively not going to promote for the costs retailers have been beforehand in a position to cost just a bit whereas earlier.
On the finish of 2021 we have been taking a look at round $1,000 as a median promoting value, whereas the numbers on the finish of the second quarter—primarily the tip of June 2022—have been virtually half that at $529.
Sadly, I do not like our possibilities of ever going again to an age the place the typical promoting value of a graphics card is lower than $300. If the previous couple of years have taught us something, it is that avid gamers will put up with ridiculous costs for the brand new shiny GPU factor. And you may guess producers have famous that.
The opposite numbers price noting is the distinction between AMD and Nvidia in terms of the amount of graphics playing cards the 2 huge GPU makers bought into retailers over the previous few years. On the AMD facet you may see both the problem the corporate had in producing the next variety of playing cards, or that it selected to maintain the numbers down intentionally. It is numbers are remarkably constant.
The purple staff solely actually appeared to kick its manufacturing into gear across the finish of 2021 the place volumes begin to creep in the direction of 3 million playing cards bought. Anecdotally that is the way it appeared to us, too. The place it was all however unattainable to choose up a Radeon GPU till late in 2021, when it nearly began to dominate retail.
That wasn’t actually right down to GPU mining both, as AMD playing cards have been usually not seen as efficient, both from a uncooked efficiency or effectivity standpoint.
Nvidia, nevertheless, went full bore into over-production, with gross sales topping 9 million on the finish of 2020 because it kicked off its RTX 30-series vary. From there it continued to develop as a result of, with GPU mining nonetheless holding sway for a lot of the previous few years, it may rely on these playing cards being bought. Now the underside has dropped out of ethereum mining the lag in manufacturing and provide means there are a variety of playing cards floating round within the channel, and retailers are now not shopping for in the identical quantity.
It was inevitable that the cryptocurrency crash, and the anticipated shift from the GPU-based operation of ethereum to a much more environment friendly one, would end in a lot of playing cards each in retail and within the second-hand market. However you actually cannot blame Nvidia for cashing in (opens in new tab) on promoting spades to the gold miners, so to talk.
Although now it is having to do a bit of injury limitation, and the urged delays in launching its new playing cards—or simply giving us a single high-performance GPU to drool over within the RTX 4090 (opens in new tab)—are the worth we’re perhaps paying ourselves.
Nonetheless, there are nonetheless new playing cards on the horizon. Nvidia’s much-leaked RTX 4090 (opens in new tab) is anticipated to be proven off by Jen-Hsun on stage at GTC subsequent week, and AMD can have its personal Navi 31 playing cards (opens in new tab) on present probably in November this 12 months.