GPU prices have soared since 2020 and are now outside the reach of many gamers. The demand for high-end hardware outstripped supply and even the cryptocurrency mining bubble had a hand in it all.
But is that a trend that will continue? Whether or not we should expect to see a decline in GPU prices depends on a number of factors.
Demand
GPU demand is driven by gamers looking to get the most out of their PCs, companies looking for more capacity for online services, and crypto miners chasing the latest cryptocurrencies. But there are also some other major drivers in the GPU market that we should be keeping an eye on.
First, COVID and other supply chain problems disrupted chip production in 2020 and 2021, which in turn caused a shortage of parts that Nvidia, AMD and their partners had trouble replenishing. Second, cryptocurrency miners have been buying up a lot of graphics cards, driving prices higher than they otherwise would have been.
The good news is that supply shortages are starting to ease up. It looks like prices are on the way back towards something more resembling normality, and we can expect to see further price cuts as stocks dwindle down and competition ramps up again. If you have your eye on a new graphics card, now is the time to snag one before it gets too expensive.
Supply
GPU prices skyrocketed over the past two years due to demand and supply shortages. The global coronavirus pandemic, chip shortages, and the continued popularity of cryptocurrency mining were all contributing factors.
The biggest factor causing this spike in pricing was the increased number of people using computers for both work and play. This led to a surge in demand for graphics cards from gamers and other consumers.
It also meant that manufacturers like Nvidia and AMD were under pressure to produce more graphics cards than they had available. In turn, that caused a glut of GPUs on the market that made it difficult for retailers to sell them at normal prices.
Fortunately, it seems that the current GPU shortage is coming to an end. Nvidia CFO Colette Kress recently told investors that the company has reduced channel inventory to a healthy level, and that the situation should remain unchanged in Q2.
Scalper activity
If you’ve been looking to upgrade your gaming PC but haven’t been able to afford the latest GPU, you’re not alone. Prices have soared over the past two years, leaving many of us out of pocket for an upgrade.
Scalper activity
One of the biggest drivers behind the inflated prices has been scalpers who buy GPUs and then resell them at a higher price than what’s listed. They do this for a quick profit, often using questionable tactics.
The good news is that the situation has improved significantly over the past few months, according to 3D Center. In fact, AMD and Nvidia’s RDNA2 and Ampere cards have seen their prices drop 18 percent and 20 percent, respectively.
Nvidia’s ire
Nvidia is a company dedicated to advancing science and industry by accelerating software. It’s been doing this for nearly three decades, and it can do it at a price that goes beyond Moore’s Law, scaling the computers they build by a million times or more.
It’s a lot of work, and it requires a certain level of expertise. This is why Nvidia has a unique position in the market: it’s the company best suited to advancing accelerated computing, and it’s the only one that can do it.
It’s also why Nvidia is trying to make sure that its CUDA platform doesn’t have to be written in a language that’s unfamiliar to outside programmers, so that accelerated computing can reach its full potential. This is where the company has taken its biggest gamble in recent years, pursuing an audacious strategy that will take it into data centers, into metaverses, and into a future where every company needs accelerated computing for its applications.
