Man, you know what really melts my popsicle?
Paper launches. You know, when a much anticipated piece of tech
finally arrives, but you can't even buy it anywhere.
And it's not even like these big tech companies like NVIDIA and Sony don't know how much stock they'll have.
So why do paper launches even happen?
Well, even though a company might be aware it's facing a stock shortage at launch time,
they often go through with the planned launch date anyway to build up hype for a product by way of comparison.
You see the term paper launch comes from the fact that the product's release is only talked about on paper.
That is, review samples are sent out to select reviewers who can then write about how awesome the product is,
especially compared to the competition. And the favorable reviews will help drive demand
before the product actually hits store shelves en masse.
For example, in 2003 when AMD released their groundbreaking Athlon 64 CPU,
which was the first consumer x86 CPU to feature 64-bit processing,
Intel quickly responded with a paper launch of their Pentium 4 Extreme Edition.
The new Pentium 4 was given to tech reviewers months before you or I could buy one.
And while it did beat out the Athlon 64 in many benchmarks,
the timing made it seem like Intel was desperate to get a product out to steal AMD's thunder
as well as the performance crown, rather than getting chips in gamers' hands,
people who want them.
And to make matters worse, some paper launches are never followed
by a real large-scale launch at all, which can happen if the company encounters
manufacturing problems that they hope they can fix before the launch window closes.
One example of this is Intel's Canon Lake CPUs, which came out in 2018.
Canon Lake was a 10-nanometer chip, and by the time it launched,
Intel's issues with getting its 10-nanometer process to work were well-documented.
Despite Intel's ambitions, Canon Lake processors only appeared
in a very limited number of laptops and Nux before being discontinued completely.
In the end, the launch was mostly just for Intel to show that they could get a 10-nanometer chip to market,
even though we didn't see a large-scale release of 10-nanometer processors
until the later Ice Lake and Tiger Lake generations.
All right, so many consumers understandably frustrated
with short supply and high prices for new consoles and GPUs,
labeled the launches of items like the RTX 3080 and the Xbox Series X as paper launches,
but this isn't really accurate. After all, it wasn't just reviewers
that got their hands on these products. There was enough supply for regular people to buy them.
It was just the demand significantly outstripped supply.
Of course, this doesn't mean that the NVIDIAs and Microsofts of the world are without fault here.
It just means that the situation didn't meet the strict definition of paper launch.
But the shortages did come at a really inopportune time for both companies
and consumers alike. The pandemic resulted in a surge of interest
NVIDIA games since we were all stuck at home, and once one company rolled their product out,
their competitor couldn't just sit around and do nothing. I mean, imagine how bad it would look for Sony
if they were still using the PS4 to compete with the new Xbox Series's lineup.
And on top of that, fab capacity worldwide has been running out
for a few years now. Demand just keeps on going up for chips,
not just for consoles and gaming PCs, but for phones, IOT devices, cars, you name it.
And all this demand has meant that many fabs have been operating at close to 100% capacity.
The good news though, is that several large chip makers have big expansion plans in the works
that should result in a 20% or even higher increase
in worldwide fab capacity in about five years time for chips built on a 10 nanometer or smaller node.
So hopefully, paper launches and other shortages won't be as common in the near future,
and you won't get ripped off on your PC and your Yeezys.
Do one or the other, you gotta pick one, scalpers! Hey, thanks for watching this video guys.
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