A perfect storm: Why graphics cards cost so much now. How much is a graphics card

Finally, if you have a solid internet connection, you can also stream your games from a cloud server for a solid 1080p gaming experience. We recommend Nvidia’s surprisingly good GeForce Now service, which lets you play a lot of the games you already have in your existing PC libraries. Here’s what you need for a good GeForce Now experience.

Why Are Graphics Cards So Expensive Right Now?

You’ve probably noticed now how expensive graphics cards are. But why? Here are the reasons for the high prices.

It’s hard to get hold of a new graphics card at the moment. Whether you are looking for a new generation or legacy card, all cards on the market today are overpriced and with limited availability.

In short: the current demand for graphics cards far exceeds the total available supply. How did this happen? Why is supply not keeping up with demand?

In this article, we’ll look at the reasons why graphics cards are so expensive these days. Many of these factors are obvious. On the other hand, others may surprise you.

The Global Chip Shortage

Why are GPUs so expensive? Economics, my dear Watson. Supply, demand, and resource allocation determine how available or expensive a good or service is, especially with what the general public sees and has access to.

We are currently facing a global chip shortage that could go on indefinitely. We use semiconductor chips in everything from computers to airplanes; producers all over the world have had to cut or limit production due to scarcity.

This applies not only to graphics cards, but also to other sectors, including laptops, phones, and video game consoles.

At WePC, we’re a big believer in building your own computer. Once you know what you are doing, it’s not only fun, but typically offers better value over buying pre-built PCs or investing in console games, and gives you the ability and knowledge to improve your system and keep it running much longer.

Demand is wild right now

Demand for gaming hardware increased during the pandemic, and everyone was bored and stuck at home. In the early days of blockages in the US and China, the amazing Nintendo Switch console turned red-hot. Even replacement controllers and some games were hard to find.

Steam released 25.2 exabytes (or 25.2 million 1 terabyte hard drives) in 2020.

Supply for the Nintendo Switch has become much more accessible over time, but when new graphics cards and next-gen PlayStation 5 and Xbox Series X consoles came out last fall, they also suffered from massive demand (and still have it). PC gaming flourished during the pandemic, and Steam was setting new concurrent user milestones, seemingly every other week.

People just want to have fun. Lots of people – even those who weren’t before.

Supply woes

While both Nvidia and AMD have said they ship the same or more graphics cards than previous releases, it still wasn’t enough to keep up with overwhelming demand, for several different reasons.

Lisa Su, the CEO of AMD, holding the rare RDNA 2 graphics chip.

As for AMD, the company not only released the Radeon RX 6000 series last fall, but also the best-in-class Ryzen 5000 desktop and laptop processors and next-gen consoles that feature AMD chips combining Ryzen and Radeon on a single die. The company also plans to launch the Radeon RX 6000 series mobile graphics processors for laptops soon.

Each of these products is produced by TSMC foundry in Taiwan using the same 7nm process. Everyone is fighting for the same wafers with a 7nm chip. AMD likely had to prioritize its next-gen console pricing during the key holiday sales season under deals with Microsoft and Sony. Ryzen processors – which were also missing – not only Intel’s top champions for the first time in a long time, but they use much smaller dies than the large Radeon chips, so they’re likely to be higher on the totem than graphics cards until the 7nm crunch dissipates a bit. That said, TSMC doesn’t expect its “supply chain tightness” to fully relax until new production facilities go live in 2023. Sigh.

The introduction of Radeon GPUs with smaller matrices (such as the aforementioned Radeon RX 6700 XT) could also make AMD more economical to focus on producing graphics cards. The smaller the cube, the more chips you can get from one wafer.

In addition to AMD’s specific staple of TSMC, the chip industry is generally suffering from delivery issues. Even car makers and Samsung have warned they are struggling to keep up with demand. We heard whispers that the components used to make chips – from the GDDR6 memory used in modern GPUs to the backing material that is essentially used to build chips – were also missing. It seems every industry is seeing a huge demand for all kinds of chips these days.

There was also a lack of memory chips that work with the graphics processor of the graphics card.

“There are other issues in the industry that our entire supply chain team across the PC ecosystem is looking at,” Radeon CEO Scott Herkelman told us in an exclusive interview on the launch of the Radeon RX 6700 XT. “Some parts of the graphics card – and even the motherboard – are now even longer, so you have to plan a little longer.”

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