Why are graphics cards so expensive?

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The PC system industry has been a true headache of unpredictability. Graphic cards are important, as every PC player is aware. Hence you must know when and how to test your graphics card for errors. The quantity of RAM and the quality of the graphics your computer can handle usually determine how well you can play a game on it.

Your PC will have trouble playing the game if one of those isn’t enough. The issue with constructing your PC or even purchasing a pre-built PC is the cost of graphics cards. Graphics cards have always been on the pricey side, despite the fact that the world’s problems haven’t made them cheaper. If you’re looking for new components, you might be wondering why are graphic cards so expensive. There are several reasons for this surge in the prices of graphic cards.

Demand:

The sudden growing market makes the lack and rising price of graphics cards the simplest to comprehend. One of the fundamental economic theories says that when demand exceeds supply, prices increase. And it is still true for graphics cards today, people look for the best increasing their demand. while you are at it, read about the best graphics cards for Ryzen 5 3600

Nobody in the world, from automakers to medical supplies to, producers of graphics cards, has enough of practically any type of semiconductor chip, the building block of most electronics.

Therefore, as we discuss the reasons for how expensive are graphics cards, what we are truly referring to is a global scarcity of semiconductors, which are a necessary component in the production of most electronics, including graphics cards.

Although there are specific issues with manufacturers of graphics cards like Nvidia and AMD, the fundamental issue is that in the last couple of years, the demand for electronics has grown much faster than semiconductor production, which has resulted in bottlenecks for too many products to list here, most notably graphics cards.

And this has been since 2001. Additionally, the 2020 surge in electronics consumption aggravated a tendency that was already troublesome. These days, every automobile, smart speaker, and smart fridge require semiconductors in addition to cell phones and computers. Therefore, chipmakers failed to acquire access to the requisite volumes of pure water to create chips in 2021, during Taiwan’s worst drought in the past 100 years. The worldwide scarcity of semiconductors was further made worse.

Cryptocurrency

Cryptocurrency mining is a significant factor in why graphics cards in particular are currently so outrageously costly.

Although the demand for graphics cards for cryptocurrency mining has been rising for almost ten years, it peaked in 2020. Nvidia and AMD unveiled their newest, fastest generation of graphics cards around the middle of 2020. Graphics cards became a sought-after item as a result of a global scarcity of semiconductors and the largest increase in the value of cryptocurrencies.

The procedure of verifying bitcoin transactions is known as mining. It takes a lot of time, energy, and computing power to mine a cryptocurrency. Since the proof of work is made public for many cryptocurrencies, miners compete to generate the right hash first in order to get paid.

The fastest graphics cards ever produced, such as those from AMD’s Radeon RX 6000 series and Nvidia’s GeForce RTX 30-series, are ideal for cryptocurrency miners.

import duties

The previous administration’s taxes on imports from China are still in effect. It raises the worth of the products by an extra 25%. It ultimately drives up the expenses and drives up the price of GPUs by passing the increased cost forward to the users.

The present government has not made any announcements on the removal of the tariffs. Because it is unknown when or if these restrictions will be lifted, graphics cards will cost more for the foreseeable future.

Scalpers

The scalpers, who sell hot goods for a profit on highly desired things, are one group of GPU hoarders. They are successfully acquiring the cards at prices that are near to MSRP, reselling them to customers at inflated prices, and pocketing the difference.

Even though many hardware fanatics wanted to purchase a new graphics card when this generation was released, scalpers had an ace up their sleeves. They were able to steal the GPUs from under people’s eyes with the use of bots, far more quickly and in much bigger quantities than a person could. Bots are automated programs that browse websites offering GPUs and make purchases using information they have already stored.

However, scalping in any form is still permitted in many places of the world. Although certain states have established laws that forbid the practice, there are no federal laws in the US that outlaw scalping.

Pandemic and covid–19

The continuous Covid-19 epidemic altered how society operated. Both in the general sense, in that it altered societal norms, exposed broken institutions, and built and destroyed entire businesses. causing both a decrease in output and a rise in demand, a straightforward supply and demand problem. People wanted to improve their gear or made investments in new hardware as a result of more people staying at home, especially those who were working. such as new components, consoles, computers, and displays.

The entire industry was forced into a shortage by that sudden rise in demand. Global semiconductor sales fell by $56 billion in 2019, or about 12%, according to SIA. The epidemic then began. And this is Why are gpus so expensive in 2022.

during covid, People playing video games surge up to an uncontrollable extent and console interest was at an all-time high. Worldwide sellouts followed the first surge in demand. More than a year after their release, neither console’s supply nor demand had caught up.

Better specs

Better technologies and premium materials are used in new GPUs to improve performance. In comparison to visuals even only ten years ago, the graphics utilized in video games and animation today are astonishing. Especially the graphics card in Xbox series.

They’re on the verge of erasing the gap between reality and computer-generated visuals. That kind of performance and definition doesn’t come cheap. Better performing materials are used in new GPUs. The price of the materials is expensive. Better GPUs cost more to produce since they require more of those resources. As a result, the GPU’s ultimate cost is higher as well.

Conclusion: Why are graphics cards so expensive?