Nvidia & AMDThis Is Why You Should NEVER Paper Launch A Product
What does Nvidia, AMD and Intel all have in common; at some point they all have paper launched a product. A very basic definition for a paper launch is showing a product with great specs on paper then launching the product before enough units are available to be purchased. Paper launching isn’t limited to GPUs since many industries have had to deal with paper launches over the years. A lot goes on behind the scenes and the technology industry is more competitive than ever so typically the first company to release a new product can start racking in the cash. Tech companies also want to be seen as a “leader” in the field and never a follower behind the latest trends. AMD has been on fire with their Ryzen CPUs and in the typical Nvidia fashion, Nvidia wanted to be the first to release their latest GPU architecture to gamers and prosumers. Once again we will get a very nice reminder of why paper launches are a headache.
2020: A Year For The Ages
If 2020 wasn’t bad enough with COVID-19, worldwide shutdowns, worldwide civil unrest, shortages and manufacturing & shipping issues, Nvidia and AMD both decided to release their latest and greatest products. Oh and CDPR decided to release the broken mess of one the biggest games we’ve seen in ages, Cyberpunk 2077, but that is beside the main point of this article. AMD released their Ryzen 5000 series CPUs and Radeon 6000 series GPUs while Nvidia released their RTX 3000 series GPUs. After all of the issues in 2020 the demand for Nvidia’s and AMD’s GPUs are still unprecedented. Even during the mining craze back in 2013-2015 which caused massive shortages I have never seen anything like this current situation. There are tons of enthusiast, gamers, scalpers and resellers trying to get their hands on the latest and greatest from AMD and Nvidia. We now have discord servers dedicated to running bots to give people the heads up on the latest available GPU stock andwe have forums or comment sections devoted solely to either make trades, buy or attempt to get GPUs. Of course we have “new” BOTS whose sole purposes is to automatically purchase as many GPUs as possible which makes things 1000 times harder for legit purchasers online. This is all within the first THREE months of the RTX 3000 release and some gamers will purchase more than one GPU which will only makes things even worse.
Resellers And Scalping
Of course when there isn’t enough supply to meet the demand scalping will be at its all-time worse. The MSRP for a RTX 3080 is $699 - $849.99 and those numbers could change as more models could be released in the future. The price range in the resell market for a RTX 3080 is $800 (if you are lucky) to $1,300+. Typically they sell around $1,000 or so. Many gamers have moved their frustration to Ebay by listing fake auctions to attempt to disrupt the scalpers pricing and bring awareness to the fact that the mew GPUs are vastly overpriced in nearly all cases. We know that the RTX 3080 is more powerful than Nvidia’s previous RTX 2080 Ti flagship, which retailed for $1,200, so these crazy prices from scalpers seems like a “steal”. Speaking of a “steal” it’s worth noting that MSI was robbed for approximately $340,000 worth of RTX 3090 graphics cards (MSRP $1,499) so it’s safe to say that even organize crime wants a piece of the GPU shortage as well. What happens is that we are faced with an easy way for people to make money and make money very fast. The timing of these GPUs could not be at a worse time, the holidays. This scalping craze is nothing new in other industries such as the video game industry. The scalpers and re-sellers know that they can get someone who loves a product so much that they will pay over MSRP and in some cases near %50 to 100% over MSRP. This is a prime opportunity for scalpers to make a great profit. However, scalping isn’t only done by regular people and smaller companies; they are also done by large well established companies in different types of ways as I will explain later in this article (see NewEgg, Best Buy and Tiger Direct below). Now with online shopping basically being the only way for the masses to get their hands on one of the newer GPUs it’s hard to enact the “1 product only” policy when users can have multiple accounts or family & friends to assist them. I have also read posts from several users on different websites not getting enough sleep due to attempting to purchase a graphic card or CPU. Other users have described and said things such as being depressed over the graphic cards and CPU shortages while others have described having dreams about owning Nvidia’s RTX GPU. Some of it could be sarcastic or it could be 100% serious, but whatever the case may be, gamers are all trying to get their hands on one of the biggest GPU releases we’ve seen in years.
AMD “claimed” That They Wanted To Prevent A Paper LaunchMission Failed AMD
Things aren’t that much better for AMD’s Radeon 6000 series either as AMD has been moving the goal post. Before AMDs Radeon 6000 series released it appears that a user that works for ASUS stated on a forum that the Radeon 6800 & 6800XT will be limited and possibly sold out within minutes. They also stated that availability should be better in a few weeks. An official tweet from AMD’s own Frank Azor, who happens to be the Chief Architect of Gaming Solutions & Marketing at AMD, stated more or less that AMD won’t paper launch their product.
Nvidia Claimed That They Were Caught Off Guard With Demand For The RTX 3000 Fission Mailed Nvidia
Nvidia on the other hand went as far as to reach out to the public regarding their shortage issue only 4 days after the RTX 3080 released Needless to say, the community wasn’t afraid to let Nvidia read all of their frustration and anger in the comment section. Nvidia stated that they underestimated the demand for the RTX 3000 series, let me remind you that a $500 GPU is outdoing a previously released flagship $1,200 GPU so I don’t understand they could underestimate anything when people were paying well over $1000 for a RTX 2080 Ti. Nvidia decided to price these GPUs to high and low in the first place (obviously there are many reasons for the pricing). Also let me remind you that this is the biggest discrete GPU Company that gamers flock to in the world. Nvidia claims that the RTX 3080 has been in full production since August, but even that should ring some bells because it is constantly sold out with reports of some companies getting single digit percentages of cards needed to saturate the demand. This could be due to several issues such as manufacturing and shipping and so on, but it could also be low yield fabrication issues as well. I personally don’t believe that Samsung was up for the task and Nvidia should have had a backup plan, same goes for AMD because if TSMC runs into any issues AMD will give Intel a wide open shot at the CPU division again (if Intel gets their fabrication process going).
Newegg: Friend or Foe?
Apparently NewEgg is finding ways to prevent the bots from checking out and paying automatically, but NewEgg has also found a way to cash in as well. Remember corporations aren’t your friend and their main goal is to make profit and keep shareholders happy. NewEgg started pairing their popular brands (RTX, Radeon, Ryzen) GPUs\CPUs with other expensive PC components that many don’t need or care about such as Motherboards, PSUs and RAM. NewEgg also updates the Combo’s with new webpages so that a bot can’t simply focus on one page indefinitely. The goal for most users is to return the unneeded item in the combo. This can help and hurt NewEgg since they are obviously trying to sell merchandise no one wanted or couldn’t sell (overstock), but also this could be bad business practices since NewEgg is not allowing returns on all of the items paired during the initial combo sell. For example, NewEgg can prevent the returns of certain items paired with specific GPUs that many gamers want right now and they have actually done this with some RTX 3000 Combos, but not all of them. This controversy has blown up recently overnight and NewEgg seems to not want to mess up a good thing while it’s going so nearly all of the Combo items can be returned.
Best Buy (MSRP) & Tiger Direct (not MSRP)
So scalping is slowly changing the industry so the industry must adapt. Best Buy is only allowing RTX GPUs to be purchased online with a catch, they are now requiring people to select their store locations and I have seen Best Buy send out notification emails with a PIN number to complete the transactions. There is also a period where you must wait before a GPU can be added to the shopping cart. Best Buy will not ship directly to home addresses during this time, but customers can pick up their GPU from the Best Buy stores. This does help, but won’t necessarily solve all the problems. What is helping is that Best Buy appears to be selling regionally which is pretty decent I suppose. For example, you won’t be able to make a purchase more than 250 miles away from your store location. Best Buy is also selling at MSRP so that’s always a great thing if you can get your hands on one of the GPUs this year. Other legit companies such as Tiger Direct has apparently been selling RTX 3080’s for more than $100 over MSRP as well as RTX 3090’s $200 over MSRP. Basically they are displaying the same type of behavior that you would expect from scalpers or resellers. Selling is a “strong” word to use in this case, more like “pre-ordering” which ultimately becomes “backordered”. It’s worth noting that Tiger Direct goes as far as to make you pay right away even before the item is on hand and\or shipped. Obviously you can call in and complain to get it cancelled. It is going to be impossible to obtain any GPU when Nvidia, AMD and AIBs all have shortages. Locally I have personally came across businesses in my area trying to cash in on the craze and claim that the only way they can get GPUs is by paying scalpers prices so they feel they must charge over $1000.00 for RTX 3080s to make a profit. These are legit and well established computer businesses that can get stock from distributers, but that goes to show that no company would miss a prime opportunity such as this current GPU craze.
So will Nvidia and AMD learn from this situation, the answer is no. Once the graphics cards are available it won’t stop people from throwing their money at both companies and all will be forgiven. History will repeat itself since we have a new generation from gamers coming in at a rapid pace. Even if a small percentage of consumers have a problem, all of the companies are banking on the majority at the end of the day anyways. Plus we still have more GPUs releasing early next year from both companies on the higher and lower end. So how do we prevent scalping, it’s simple, make sure you have enough of the product on hand before rushing it to the market; the product must be widely available. This won’t prevent bots and crazy pricing, but it would at least make people think twice before buying a product solely for the intent of reselling it at a ridiculous higher price point. I do like some of the measures that Best Buy has taken and NewEgg (somewhat), but just like when Cyber Security was a big thing, it’s time for companies to adapt to the world today. Online shopping is ruining one industry at a time and we need to ensure that we can purchase the items physically from actual stores. Companies must setup away to verify legit purchasers which means they must invest. We cannot allow GPUs to only be purchased solely online due to situations like this. This would lead to great PR, but I doubt if many companies will change their entire structure solely for popular Graphics Cards; regardless of how many “recommendations” AMD sends to retailers\e-tailers. They will take the cheapest route to try to ease the pain while capitalizing at the same time. Best Buy requiring purchasers to pick up the GPUs in store is a great step to ensure that only one person is receiving a GPU from them. That can't be the only solution, especially for those who don't live near a Best Buy, but it's a step in the right direction. People can live with a few weeks of waiting, but waiting several months is pushing it. Christmas is right around the corner and we are reading reports that the shortages might not get better until Q1 2021 which could push the shortages well into February or March of next year if the demand stays this high. Releasing in Q1 2021 would be better, but companies have targets to hit and profits to make. We still have more GPUs releasing Q1 2021 next year so things could actually get worse since both companies have shown us that they aren’t ready to fulfill the demand. With all of that being said I still look forward to benchmarking whatever I can get my hands on at some point at decent prices near MSRP. This is an ongoing situation so I will add updates accordingly. Stay tuned.
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