WEBVTT

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it's china joy sorry

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what is china joy well apparently it's a big enough event

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for AMD to announce their latest GPU there so

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yep another graphics card no one can afford thanks to scalpers and miners or

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is it yes it is but AMD's Radeon rx 6600 xt

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announcement also gives us an excuse to talk about why pricing for these parts

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is still so outrageous and some of the big changes that could

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finally put an end to the GPU shortage in the coming months

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it also gives us an excuse to tell you about our sponsor seasonic

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AMD's new Radeon rx 6600 xt is looking

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like a pretty standard launch so far you got 32 compute units 8 gigs of gddr6

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memory and 32 megabytes of infinity cache clock speeds are reasonably high

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and we already know that rd and a2 is a ridiculously scalable architecture

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thanks to earlier looks at their mobile parts they'll be available starting

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august 11th from third parties only no

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AMD branded card this time around although AMD says that there is a

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reference design that will likely make up the bulk of the early shipments the

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reference design calls for only a single 8-pin pci express power connector with a

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total board power of 160 watts that's not too shabby for what AMD is touting

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as a 1080p monster that beats out the rtx 3060 and pulls over double the gtx

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1060s performance and it's efficient enough to be cec compliant unlike

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certain gaming pcs from our friends at dell

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got em make sure you get subscribed by the way we have a whole video coming about that

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debacle the only problem with this announcement is that if you hated the

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rtx 3060s msrp of 329 us dollars the rx

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6600 xt's 379 dollar price tag is going

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to be even more painful it is roughly as

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fast as its price difference suggests if AMD's benchmarks are to be believed

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however so it could still end up being a great value at least by today's

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standards it's an open secret that GPU prices have been steadily rising over

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the past few generations i mean heck the gtx 1080 launched at 5.99 and the 1080

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ti a GPU that held its status as a top

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tier gaming card for over three years cost just 6.99 ah memories but

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unfortunately memories may be all there is left to that kind of pricing at least

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for the foreseeable future and trust me i hate it too

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but that's just the way it is as for why

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it's the way it is there's a litany of reasons but a few key factors stand out

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starting with of course the corporate greed angle that's been thrown around

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ever since the launch of NVIDIA's rtx 20 series

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the thing is believe it or not both NVIDIA and AMD for that matter love

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their shareholders much more than they will ever love you or me but it's also

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not the only reason there are some very real logistical problems that are

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steadily pushing pricing up as companies try to remain profitable though to be

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clear the companies i'm referring to there are not NVIDIA or AMD neither of

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which are struggling to remain profitable in fact compared to a year

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ago both of them reported nearly double

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the gaming revenue in the most recent quarter with healthy gross margins of

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anywhere from 50 to 65 so the business of designing gpus

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partnering with a chip foundry like tsmc or samsung and selling the chips to

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board partners is as healthy as ever it's the board partners folks like evga

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ASUS or MSI who are feeling the squeeze

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and passing that squeeze along to you take memory for example

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dram supply has been seriously hampered by the silicon shortage with contract

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pricing going up by 5 to 10 in the first quarter of this year then a

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staggering 20 to 25 in the second quarter with a projected

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eight to 13 percent more again coming in the third quarter that is over a 50

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cumulative increase in the price since the end of 2020 and spa prices have been

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consistently worse with current prices sitting at easily double the contract

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price and trend for saying that at the scalp apocalypse's peak spot prices were

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up as much as 200 percent higher than contract pricing which is

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wow so that is why NVIDIA can the

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rumored high memory rtx 30 series eh at least for now

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and this isn't likely to let up demand from game consoles and gpus remains high

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and the realities of wafer production mean that eight gigabit and 16 gigabit

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gddr6 chips need separate allocations

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so this crucial manufacturing capacity is split

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the consoles use 16 gigabit chips while consumer gpus currently use eight

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gigabit chips and the majority of eight gigabit capacity is reportedly feeding

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NVIDIA's lower end 30 series gpus which leaves

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very little on the bone for anyone else thankfully the 6600xt is going to be

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using 16 gigabit chips so for this launch anyway it's less of a concern

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the final dram factor though is somewhat unexpected and it's servers

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that's right this whole thing is colliding with a big boom in server

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orders and servers they need dram lots

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and lots of dram and all of that is just the memory next

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up we've got copper you know that stuff that good heat sinks are made of among

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other things well copper's gone from a little under two dollars twenty cents

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per pound in mid 2020 to double that as

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of today and a lot of that has to do with speculation that a global economic

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rebound will boost demand for metals used in manufacturing and in

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construction if that sounds like it'll impact a lot more than copper

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you're right aluminum prices are skyrocketing they're up about 45 since

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this time last year steel and nickel are up nearly 30 percent plastics are up 47

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and neodymium which is used for magnets in fans and headphones is up a

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staggering 88 even tin and lead which

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make up solder are up nearly 36 and 14

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respectively so all of that means that virtually every material that goes into

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producing a GPU or really any consumer electronics is significantly more

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expensive than it was just a year ago with the sole exception being gold

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and the fun keeps coming if you're a us resident and the GPU that you want is

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made in china tariffs are famously misrepresented by

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politicians and enthusiasts alike but the tldr is u.s consumers get to pay the

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u.s government between 10 to 25 more for

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electronics manufactured in china right now which as of the end of 2020 has gpus

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falling in that 25 bracket

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there's no tariffs on merch from lttstore.com though so buy a t-shirt

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like this one and you'll be amazed how many fellow tech fans approach you to

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talk shop it's actually kind of great the final head of the GPU pricing hydra

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is of course the silicon shortage itself now we can see from AMD and NVIDIA's

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financial reporting that they've been telling the truth all along

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sort of like clearly they are producing plenty

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of gpus but even if we account for NVIDIA taking on average 10 more profit

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margin than they did in 2015 both of them are experiencing clearly

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unprecedented levels of demand and when demand goes up

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pricing goes up this shortage is affecting industries

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everywhere from electronics all the way to automobiles and recent reports show

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that even apple who to date has seemed relatively insulated thanks to their

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careful production forecasting is starting to feel the crunch

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AMD's dr lisa said during an interview with behrens that supply is expected to

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remain quite tight until 2022 and while

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AMD may be making inroads on supply the silicon shortage as a whole is likely to

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continue well into next year thanks to the disruptions that covet has caused in

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labor logistics and materials

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thankfully taiwan's worst drought on record did let up in late june which

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should take some of the pressure off of tsmc who happens to be the world's

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largest chip foundry in other good news for consumers looking to buy a GPU one

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of the major factors influencing demand for these processors mining has begun to

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wane in recent weeks following crackdowns on crypto mining by the

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chinese government since crypto's pricing began to fall in

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early may gpus have at least begun to experience a slow return to normal as

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miners have begun fire sailing gpus in

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the chinese market although pent-up demand from gamers means that prices are

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likely to remain high for the foreseeable future that is until we get

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a mainstream GPU that is shipping in serious enough volume to put enough

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cards in gamers hands that it puts pricing pressure on the more premium

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ones get subscribed then by the way so you don't miss our review of the rx 6600 xt

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when it launches it's based on AMD's navi 23 die which should mean better

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yields per wafer helping to chip away

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pun intended at the supply constraints that is assuming it ends up being a

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solid card now at this point in the video you might have noticed that i

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didn't ever offer an opinion on the state of the gaming GPU market that's

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because in my opinion it doesn't matter what i think

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that's the hottest take you're going to get for me today the unfortunate facts

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are that there is little that can be done about GPU pricing right now but the

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good news is that once economic recovery efforts are in full swing demand for raw

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materials should begin to fall off and with any luck we'll be able to live in a

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world where the fun comes back into pc building

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you could try to accelerate the end of the ride by keeping your money in your

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pocket when the 6600 xt briefly hits store shelves

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but truthfully it probably won't change anything just like i never changed the

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segways to my sponsors not even to build redux thanks redux for

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pay only the 75 build fee and then whatever you already would have spent to

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get the parts plus with redux you get a two year warranty for the parts and

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labor on your expertly built pc use their online pc builder to customize

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what's going inside based on the games you want to play and your budget and

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that's it it really is that simple redux wants to bring pc gaming to the masses

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which is why they only charge a small build fee and they don't cut corners on

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quality so click the link in the description to create your dream pc

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today while you're down there maybe check out our recent video on NVIDIA actually

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discontinuing support for their kepler gpus and whether you really need to

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upgrade it's kind of a strange sentence to say

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about a GPU that first launched nine years ago

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man another nine years that's you go back nine more years

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that's GeForce four isn't that crazy