This is what analyst Jon Peddie sees as a likely outcome, according to his research
Jon Peddie, the CEO of Jon Peddie Research (JPR), wrote an article for Graphic Speak (opens in a new tab) (spotted by Tom’s Hardware(opens in a new tab)) about the graphics market and PC desktop cards in particular.
With a graph showing the gradual rise in pricing since 2014, but a sharp rise between 2020 and 2021, the report looks at the average selling price of AIBs (or add-in boards, which is a fancy term for PC graphics cards).
Over a three-year period from 2014 to 2019, the average price of a desktop GPU in the United States went from $270 to $440, but in 2020 the average selling price jumped to over $650 and further to about $780 in the following year. That is, of course, absurd, but Peddie goes on to explain the reasons why.
There has been at least a two- to three-fold rise in the cost of PC gaming and mining AIBs in comparison to PC notebook GPUs, as noted by Peddie As a result, a lack of supply cannot be to blame for the rise in PC AIB pricing. The only ones left are the speculators, gougers, and miners. This isn’t a prank.
There is a significant chance that these inflated prices will fall, leaving the price gougers with graphics cards they can’t sell (or rather they’ll be obliged to sell them at a loss—what a tragedy that would be),” ends the author.
Is a GPU price crash really on the horizon?
In general, we agree with Jon Peddie, and as we’ve already stated, pricing has gotten out of hand, especially by mid-2021, when some Nvidia graphics cards were selling for three times their MSRP.
It’s apparent who’s to blame: Bitcoin and Ethereum mining demands drove up demand, removing cards from players’ hands, while supply issues created by the epidemic exacerbated everything – and then led to the third factor: scalpers trying to acquire rare inventory and resale it for high profits.
We’re not sure if GPU pricing will ‘collapse’ as Peddie suggests, but that’s something we’ll keep an eye on. The supply of graphics cards has been steadily increasing over the last few months, but prices have been drifting down and levelling slowly rather than quickly.
There has always been a belief, however, that in the second half of 2022, both AMD and Nvidia would be able to recoup from the component shortages, with new Arc cards from Intel also coming to market. With such a hopeful combination of positive moves forward, there’s reason to believe that the GPU market will see prices decline at a rate closer to a stone than to a feather.
On the whole, buying a graphics card this month looks like a bad idea, and the best strategy is to wait and keep an eye on the price tags, which are only going up (with the other eye on potential market developments that could muddy any recovery, like further lockdowns in China for example).