Key Takeaways
1. Rising Memory Prices: Demand from AI companies is driving up the prices of DDR4 and DDR5 memory, affecting the cost of gaming GPUs.
2. Potential GPU Production Cuts: AMD and Nvidia may halt production of budget-friendly GPUs if GDDR VRAM costs remain high, impacting models like RX 9060 XT and RTX 5060.
3. Price Increases Expected: AMD plans to raise prices on RX 9000 GPUs, with Nvidia likely to follow for the RTX 50 series, making entry-level GPUs less affordable.
4. OEMs Reducing Offerings: Manufacturers may limit memory configurations and product lines to manage increased costs, leading to fewer affordable gaming GPU options.
5. Market Timing: Current GPU prices may present a good buying opportunity as significant value loss is anticipated in the gaming GPU market.
Rather than providing, the “gift” of AI continues to take from gamers. A recent example of this is the relentless rise in memory prices. As we have reported before, strong demand from AI companies and datacenters has caused consumer DDR4 and DDR5 memory prices to double or even more from their lowest points. This inflation was also anticipated to affect gaming GPUs, such as the new RX 9000 and the RTX 50 series. However, the situation seems to be worse than we thought.
Potential GPU Production Cuts
According to The Korea Economic Daily (via Jukan on X), both AMD and Nvidia might stop making mid-to-low-end gaming GPUs if the cost of GDDR VRAM accounts for a significant part of the Bill of Materials (BOM). In simpler terms, budget-friendly GPUs like the RX 9060 XT, the RTX 5060, and the RTX 5060 Ti could be cut from production if AMD and Nvidia can’t get VRAM for these models at acceptable prices.
Rising Costs and Market Impact
This situation makes sense when we look at today’s memory market. Just yesterday, a report surfaced on the Chinese Board Channels stating that AMD may raise the prices of all RX 9000 GPUs due to escalating memory costs. Naturally, Nvidia is likely to follow suit soon and raise the prices for the RTX 50 series as well.
One could argue that a consumer looking for a mid-range or high-end gaming GPU, which costs more than $500 or $600, can handle the extra VRAM price. However, for entry-level gaming GPUs, even small price changes can be a big deal for consumers. Thus, a 10 or 20% increase in the price of a $300 GPU like the RX 9060 XT would hit harder for budget-conscious gamers than it would for someone looking for $700+ GPUs like the RTX 5070 Ti (Available on Amazon).
OEMs Facing Challenges
The Korea Economic Daily also mentions that OEMs, such as Asus, are thinking about “reducing memory configurations.” This suggests that AIBs might narrow their offerings to include only those gaming GPUs where the increased VRAM pricing is more manageable. Moving forward, it could be quite challenging to find affordable gaming GPUs at reasonable prices, a situation reminiscent of what we experienced during the COVID era.
In conclusion, it looks like gaming GPUs are going to lose value significantly. So, if you’re in the market for one, now might be the right time to buy. Fortunately, you can still find some good deals on gaming GPUs. For example, as of now, the ASRock Challenger Radeon RX 9070 is listed at $540 on Newegg, while a PNY NVIDIA GeForce RTX 5070 OC is priced at just $489 at Walmart.
Source:
Link
Leave a Reply