Exchange rates fluctuate, often it’s been ~1.05:1 which is a long way from covering the 20% VAT. Add some uncertainty, stronger consumer protection laws, and smaller markets and the price difference is relatively small.
Where in reality there shouldn't be any, since sending stuff across the pond costs nothing as seen in products like bananas. At least I live in place which has only 8% VAT, so prices look a bit more like US (but still higher for no good reason)
VAT I get - everybody pays it, but if company imports stuff (especially local branch/official distributor), they should do import paperwork - are there any additional fees included?
It's the 2-year warranty, translation of manuals and a need to have office in all major EU markets due to different legal stuff that makes it all pricier.
You dont need an office in every EU market, thats the thing about the EU, thats it one big singular (or connected) market, and if you can sell your stuff in one EU country, you can sell it in all of them. (very few restricstions apply)
Most probable explanation. 19% in Germany. So, $1199 in US, ~$1443 in Europe. 1199 * 1.19 = ~$1427. $1439 with Austrian VAT of 20%, but price is still 1259 Euro, so it seems nice. Seems about right.
Yeah; it's illegal to list prices for consumer products ex. VAT. If you're b2b you're allowed list ex-VAT but you are required to be very clear about what you're doing.
Which things exactly? Manuals translations is SO DAMN EXPENSIVE. They have to sell, what a dozen or so cards to get those losses? Or 7 european (EU) offices of which one is also a dev center vs 15 US offices (of which one is HQ/dev)? Or stock which comes to both from Taiwan?
In any case, it seems VAT is the explanation and in that case price is without premium, even great compared. Still expensive.
The EU does enforce a "2-year warranty", but it's not what you think. (Speaking as a German:) When you want to replace a broken product under the mandated warranty, then:
- In the first 6 months after purchase, the merchant must replace the product unless they can prove the defect was not present at purchase.
- After 6 months, the burden of proof reverses, and the customer must prove that the defect in question was already present at purchase.
In practice, whatever party has the burden of proof usually doesn't bother. So in effect, "6-month warranty" is a much more realistic description of this 2-year warranty.
(The fine print: Many vendors offer their own voluntary warranty on top of the mandated one. And I don't know if the rules are different in other EU countries.)
> In practice, whatever party has the burden of proof usually doesn't bother.
In practice, I've never had to prove anything within 2 years of purchase. Might be a difference between Germany and other EU countries, but somehow I doubt that.
This is probably how it is across the EU. Why antagonize your customers unnecessarily by forcing them to jump through hoops when your product fails in less than 2 years? That just leads to bad PR and reduced customer satisfaction and thus lower trust and sales.
They benefit in the perceived sense of reliability of a 2 year warranty. Why buy a product if it's going to fail in 6 months and you can't get it replaced, when the competitor is more likely to treat you fairly.
Stuff very rarely breaks in the second year. I'd bet the vast majority of warranty claims are within the first year, which is legally mandatory in every jurisdiction of note.
At NVidia's level, nearly so. They ship on the order of 50 million desktop GPUs each year. Legal hours, real estate, or translators may seem expensive, but when you count the number of graphics cards that would be required to pay for them it's not even in the ballpark of 50 million.
The warranties do cost something because they add significant risk/cost against each incremental unit, I will grant you that.
Regulations like these have a disproportionate effect relative to volume. NVidia would probably have most of those things even in the absence of the regulations, a couple guys in a garage would certainly not.
NVidia's lesson from the Crypto-boom seems to be: "Some gamers are willing to pay >$1000 for their cards".
EDIT: To be fair, NVidia is still on 14nm or 12nm class lithography (I forgot which one). So the increased die size of these new chips will naturally be more expensive than the 10xx series. Bigger chips cost more to produce after all. So if you fail to shrink the die, the economics demand that you increase the price instead.
Still, we all know that NVidia has fat margins. We also know that they overproduced the 1080 series during the Cryptoboom, and that they still want to sell all of their old cards. If they push the prices down too much, then no one will buy the old stuff.
NVidia doesn't make many cards. They mostly make chips. The "Founders edition" are an exception, but the mass market products are made by EVGA, MSI, and other such companies.
The fire-sales on EVGA 1080 Ti chips make it darn clear that there's too many 1080Ti and 1080 cards out there.
Second: these RTX 2080 chips have been in the rumor mill since June, maybe earlier. The fact that NVidia delayed until now is proof enough. NVidia has been stalling on the release of the RTX series.
>> Nvidia previously had forecast sales for cryptocurrency chips for the fiscal second quarter ended July 29 of about $100 million. On Thursday it reported actual revenue of only $18 million.
So its not entirely clear who overproduced things per se, but what we DO know is that NVidia was expecting $100 Million cards to be sold to cryptominers between April and July. Only $18 million were sold.
In any case, it is clear that there's a lot of 10xx cards laying around right now. And NVidia clearly wants to extract as much value from current stock as possible. Pricing the 20xx series very high above the 10xx series is one way to achieve what they want.
Could you cite this? I've heard the opposite: that Nvidia didn't chase after the crypto market /because/ a crash would cause problems (if they overproduced). Besides, they make plenty of money everywhere else. Furthermore, Intel has charged (edit: consumers) $1000+ for a chip before. The market will bear it, crypto or no crypto.
>> Nvidia previously had forecast sales for cryptocurrency chips for the fiscal second quarter ended July 29 of about $100 million. On Thursday it reported actual revenue of only $18 million.
That suggests that NVidia has $82+ million worth of 10xx series GPUs laying around somewhere.
Rumor is that AMD's Navi is but a minor update next year. "Next Generation" is 2020 and beyond for AMD.
So unfortunately, NVidia can bet on a lack of competition for the near future. NVidia can always drop prices when Navi comes out (if it happens to be competitive). But it seems like they're betting that Navi won't be competitive, at least with this pricing structure.
I dunno. We know Intel's roadmap: Icelake next year at 10nm (with AVX Instructions), Tiger Lake (10nm optimization), Sapphire Rapids (7nm) in 2021, etc. etc.
It seems like if you want people to buy your products, letting them know about them and the features they'll support (ex: AVX512) so the hype can build is a good thing.
About 4 years ago Nvidia also used to publish a "roadmap" that showed a somewhat fake performance versus architecture plot. They stopped doing that after Volta.
There’s a huge difference between saying “we will have something in the future” (duh) and saying “we have absolutely nothing for the next year and a half.”
The latter gives your competitor the freedom to ask any price the market will accept without having to worry about a competitor undercutting this price in some near future.
Balance between area, yields and tooling - a mature process with established tooling and strong yields can offset some of the additional wafer costs required by larger area.
