Leave NVidia alone!

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This is an email I got today, probably the best of those defending NVidia, and there is one legitimate point made here.

Writer’s comments in italics, mine in plain.

I think you’re confusng component pricing with retail pricing here Ed.

$699 MSRP.

1: The GPU on the GF2 Ultra and the GF3 are a small (though significant part) of the cost of the card. IIRC, the GF2U chip was around $40/each in lots of 1000.

I looked for that sort of pricing at the NVidia site, was unable to find it for anything after the TNT2U. If anybody’s got an URL with that information, please send it to me.

2: The big buckaroonie-killer in the card is the high-end 3.8ns RAM (which this card NEEDS, but which is STILL overrun by the theoretical output of the GPU). It’s the fastest RAM that can be bought in any type
of shippable quantity.

Two points here:

  • We really need to find out how much these DDR modules do cost and
  • How much of a performance difference can 3.8ns DDR RAM make over 4ns DDR RAM? 5%? I find it somewhat difficult to believe it will cost all that much more; what I really don’t believe is that it makes enough of a difference to justify jacking up the price another 30-40%.

    3: nVidia doesn’t set the final price on these things. The CARD MANUFACTURER (Read: NOT nVIDIA) does.

    You design the chip and the parameters, you effectively set the price.

    They’ve got to make a profit on these cards after all.

    Profit is not something brand new to video card manufacturers.

    Telling nVidia to lower the price on
    nVidia-based video cards is akin to telling Michelin/Goodyear/Firestone/etc to lower the price on a Corvette or
    Viper RT/10. And while the GPU is arguably more important to overall
    performance than tire brand is, it’s still an apt comparison.

    No, it isn’t. The tire maker doesn’t design and make the engine, and at least set the parameters for all the other power components of the Corvette.

    It’s everybody else’s fault except NVidia. They’re just innocent bystanders in all this. This is ridiculous. Do you know why?

    Tip for arguers: Don’t use what I call Vestal Virgin arguments.

    If you’re a lawyer defending someone against a charge of prostitution committed in a red light zone at three in the morning; you say she’s innocent of that particular crime. You don’t try to portray her as Pippi Longstocking; that’s simply laughable.

    You have a company whose new top-end product went up $200. You can argue that the price increase may be largely due to other factors, and that could be a pretty good argument, but to portray the company that makes and designs the product as completely innocent victims is absurd.

    4: And since production isn’t an instantaneous thing, production has to
    ramp up. Correspondingly, the first cards are going to be the most
    expensive due to the laws of supply and demand. nVidia’s already had
    several manufacturing-related setbacks on releasing this GPU.

    MSRP: $699. That sets parameters on pricing for quite a while. Sure, the first few cards will cost more, we’re not concerned about temporary scarcity pricing.

    What we are concerned about is where the price settles around, and based on what we’ve seen with the Ultra cards, it looks like a good deal north of $500.

    5: And before you say “We’ll NEVER do ‘X’ till ‘Y’ happens”, you’re just
    hurting yourself and hurting your readership. Never say never.

    We look for products that represent good value to our audience. This is not currently a good value to our audience; just alone because few if any memebers in our audience will or even can buy this card at this price. How are we hurting people by not reviewing products they wouldn’t normally buy anyway?

    We’ve previously asked our audience about this. The answers we got back gave us a very clear idea of what they would and would not pay for a video card, and even the most willing came nowhere near the price tag on this sucker.

    It’s like saying a neighborhood of Ford and Chevys gets “hurt” by a Rolls Royce salesman not going door-to-door.

    Doing a review now for a product that is well, well beyond the typical price range of our audience only serves to hype the product and tempt people into buying a product that in our judgment is a waste of money at this time. We respect our audience too much to do that.

    There’s also a technical reason why we see no point in reviewing the product at this time. The new features that have people like John Carmack excited require some serious work by game programmers before they work. That’s going to take time, maybe a lot of time. And time is money here.

    “Never say never” sounds silly when I never said never. I did not say, “We will never review a GeForce3 card, ever.” I said, “We will never review a GeForce3 card UNTIL it at least approaches a reasonable price.”

    6: A Voodoo2 SLI setup, in it’s time cost nearly $700. And hardware
    sites reviewed them. And people paid for such setups.

    And by God, we need to get back to the good old days again. 🙂

    People have merely been spoiled by cheap, powerful video cards because no graphics
    card had LOTS of head-room up until the last couple generations, so they
    could get away with much cheaper componentry.

    Ah, hah! It’s not NVidia’s fault; it’s YOUR fault!!! You spoiled rotten ingrates!! How dare you balk at paying double or more the price? Pony up, the gravy train is over.

    You get the feeling this guy’s HAPPY about this?

    Now that the GPU’s potential is growing so quickly

    “Potential” is just the right word with all those bottlenecks, isn’t it?

    ultra-high end components are needed to
    get as much usable performance as possible.

    Hmmm, the Ultra went from DDR 5ns to 4ns. That’s a 20% difference; I can see why that might cost significantly more to produce, and more importantly, why that might make a significantly different and meaningful difference in some cases.

    But going from 4ns to 3.8ns this is a 5% change, with the same markup, if we are to believe that the GPU doesn’t cost significantly more. What sense does that make?

    It’s money that is better
    spent than on some wasteful redundant-RAM setup like the Voodoo5 was.

    If a number of cheaper components can do the same as one gold-plated one, why not, but again, $200 more at retail for 5% better components?

    7. Why don’t you actually wait till the card hits the market/shelves
    before damning it on price? You should know, as well as anyone, how
    malleable the price of a computer component is.

    In short, be quiet until whatever comments you make can be swamped by the hype machine.

    MSRP: $699. That gives me an awfully good idea what pricing is going to look like: $550-600.

    Now before I come off as a corporate apologist I’m going to add that I’m disgusted at the possible price of the card myself.

    ROTFLMAO!!! With I think one exception, EVERY person defending NVidia’s pricing tried this trick. How disgusted can you be given when you grabbed at any and every possible straw to defend them?

    A truly disgusted but fair-minded person would have simply brought up the issue of GPU/RAM cost, and left it at that, not thrown anything you could think of hoping something would stick.

    A truly disgusted but fair-minded person would not have called people “spoiled” for wanting to pay a reasonable amount for their video, or cited ancient examples to justify pricing, or glorifying “ultra-high end” components that are minimally better than the previous high-end components.

    While I cannot be absolutely sure of this, I think you like this pricing quite a bit, and the most likely reason is you (or if not you, others who also think like this) view this as a status symbol. “Now I can have something some snotty-nosed kid can’t afford.”

    But at least I’m going to give them the time to actually bring the card to market and
    achieve nominal penetration on shelf-space before I go damning them and
    the card manufacturers as money-grubbing bastards.

    I’ll make you a deal. If, within forty five days from today (April 10), the price of say, the Asus version of a 64MB version of this card is closer to $300 than $600; I’ll write an article and call myself an idiot. If the price is closer to $600 in forty-five days, you write something saying how wrong you were.

    Do we have a deal?

    Wouldn’t the time be more productively spent dissecting exactly HOW the
    pricing of such cards is set (component pricing+manufacturing/marketing
    costs vs retail price)?

    No, but it would be a good idea to do that also, and I’m going to try to do just that.

    Then your readership, instead of being inflamed, would understand why
    the latest and greatest is going to set them back 2-4 weeks’ pay.

    The average member of this audience needs no help from me to be “inflamed” on this issue. All they have to look at is the price tag.

    This is RAMBUS all over again. Sure, lots of hardware sites said bad things about that a year ago, but you’d have to think this audience is a bunch of mindless morons to think that they would have all gone off and bought RDRAM if evil hardware sites hadn’t told them not to.

    Besides, the next article talks about what I think is the inevitable GeForce3 MX.

    Email Ed

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