AMD graphics card pricing skyrockets due to cryptocurrency mining, could kill AMD - s gaming efforts

Cryptocurrency-fueled request has driven the price of AMD Radeon cards through the roof ter latest weeks, and consumers are feeling the pinch. This is a trend wij’ve remarked on several times ter the past, but rocketing prices have klapper fresh heights ter latest days, with the price of the R9 290X shortly cracking $900 overheen the weekend. Considering the card carries an official $550 MSRP, that’s a massive 64% overheen premium.

Prices seem to have come down slightly since yesterday’s exuberance, the R9 290X is presently selling for a “mere” $800 at Amazon, while Newegg has a handful of cards te stock for $700 . The R9 290 is selling for $600 – a mere 1.5x markup on its $400 MSRP. (Oops: When I commenced writing this story, Newegg had a handful of cards te stock for $700. Now, it doesn’t.)

The insanity, however, isn’t restricted to the highest-end cards. Here’s a comparison of the official AMD MSRPs and the current selling prices.

Price %’s overheen MSRP

Even the R9 270 cards are selling for 30-40% overheen MSRP, while the R9 280X – a GPU that’s supposed to cost $300 – is actually selling for $489. Wij can zoom te on one particular card thanks to webstek price-tracker CamelEgg, and see the greater problem.

Save for a schrijven period ter late November and instantly after Christmas, the gap inbetween official selling price and street price on the R9 290 has bot enormous. It also corresponds exactly with the rise of alternative cryptocurrency mining (Litecoin, Dogecoin, et hoewel.) spil Bitcoin became too difficult to work with.

This might sound like a good overeenkomst for AMD. Phat request for movie cards lifts prices, prices drive profits. Everybody wins, right?

Maybe. Unluckily it’s not that ordinary. AMD hasn’t switched its MSRPs, which means much of this price gouging is likely pulling down into the pockets of Newegg and Amazon resellers, not Sunnyvale itself. Just because AMD hasn’t switched its MSRPs, of course, doesn’t mean it isn’t calmly charging higher wholesale prices, but its capability to rechtsvordering some of the bubble’s earnings for itself is likely limited by previously agreed-upon contract prices spil well spil the volatile nature of the market. Add-in houtvezelplaat playmates (AIBs) won’t pay thick premiums for chips when they know the market for those processors depends on something spil volatile spil the cryptocurrency markets.

Downstream complications

Beyond making life joy for reviewers, who have to take practical cost considerations into account when evaluating different GPUs, there’s another problem here. AMD’s entire GPU strategy since October of 2013 has relied on steep price cuts to fuel sales. The Radeon R9 290 and R9 290X were killer cards partly because they equaled or bettered Nvidia’s GTX 780 or GTX Titan, but at far lower price points.

At $400, the R9 290 wasgoed quicker than the GTX 780 – and the GTX 780 is $100 more expensive. When the R9 290 is selling for $600, the entire value equation around AMD’s MSRP’s falls exclusief. An R9 280X for $489 is an absolutely terrible investment, the Nvidia GTX 780 will demolish that price-performance ratio – but that’s where things sit today.

Thesis price trends are particularly worrisome given that AMD has just launched its fresh Mantle API. It’s essential that AMD illustrates strong request for its graphics cards ter gaming. GPUs sold into the cryptocurrency market at big prime premiums could wind up driving gamers away from AMD at the very time Sunnyvale needs to win them overheen.

That’s not to say wij’ll see companies pulling down Mantle – it just makes the way forward that much tighter for AMD. When it comes to Mantle, a GPU sold to a gamer and a GPU sold to a miner aren’t fungible. The modest positive influence on AMD’s graphics revenue may not be worth the long-term complications or potential loss of market share.

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