PC Component monopoly

[Guest]

What would happen if for example AMD were to disappear from the GPU market, and NVIDIA decided to crank up their product prices without any justification? Would consumers be forced to pay more?
And what if this also happen on the cpu side with INTEL being the one overpricing their product?

 

[CountMike]

Somebody else would show up for sure. ARM processors are shooting for desktop market for a while now. Nvidia works on universal GPU/CPU processors and already have some in game consoles.
Any holes in the market fill up fast.

 

[Phillip Corcoran]

"And what if this also happen on the cpu side with INTEL being the one overpricing their product?"

Intel processors aren't overpriced - - they are simply superior to the competition (mainly AMD).

Just because something is expensive doesn't necessarily mean it's overpriced.

 

[Solandri]

This is market economics 101. If AMD were to disappear, Nvidia would be able to crank up their prices, up to the point where GPUs become so expensive and lucrative that another competitor(s) would decide to enter the market with their own GPUs.

Most of you younger people have only known AMD and Nvidia. But the field used to be filled with lots of competitors - 3dfx, Matrox, SiS, Tseng labs, S3, etc. The jump from 2D to 3D graphics card significantly raised the required competency level to remain competitive, resulting in a lot of culling and consolidation. I had one of Nvidia's first GPUs in my work computer (back when they were nVidia, and 3dfx dominated). It sucked - not just slow but buggy (hardware bugs). I never would've predicted they would go on to become the dominant GPU designer. If I had had money at the time, I probably would've shorted their stock (and be homeless today) - that's how bad their product was. So you never know what the future will bring - David regularly slays Goliath.

Intel processors aren't overpriced - - they are simply superior to the competition (mainly AMD).

More precisely, Intel processors are priced high enough that people are still willing to buy them, but low enough that they (1) don't give AMD enough room to price AMD CPUs higher so they can invest more money into R&D and catch up to Intel, and (2) don't encourage another competitor to enter the CPU market because the prices are so high.

Right now I'd say ARM (a RISC architecture) is Intel's biggest threat. Not because ARM CPUs perform great, but because CPUs are getting so fast that 99% of people's computing tasks can be accomplished with a low-end CPU like ARM. So Intel's speed advantage doesn't matter as much anymore. The new metric (for general sales, not enthusiast sales) is performance per Watt, or $ per performance per Watt. The 2.3 GHz quad core ARM7 in my phone costs about $25 and blows away the $200+ PC CPUs I had in the 1990s and some I had in the 2000s.

 

[synphul]

I think in any market there's also a matter of reason. Let's pretend that all video game consoles and pc's were reduced to one company with one device on which to play games. They go to raise their price to $10,000 and not many will buy it. Not only because the price is ridiculous, it becomes a matter of how badly people want to play games. It's a want, not a need.

People simply wouldn't buy it and they would be priced so high they would be left with overpriced stock of products that aren't selling enough to bother keeping the doors open. So no there isn't 'unlimited' headroom to price things. With or without competition comes the matter of what the market will bear. Would prices increase in such a hypothetical scenario? Maybe some, but not out of control. Not if they want to continue selling things.

People want a free market where there's competition and anyone can theoretically sell their goods but with that comes the cutthroat dog eat dog world of competition. Yes you may create competition, but 'can' you is the real question. The flipside would be some sort of mandate, controls on goods, artificially contained markets and people don't feel that's fair either.

 

[CountMike]

Intel is near monopoly thanks to their being first with real personal computers. Before them processors were used in dedicated machines, There was Motorola and Zilox but none were used in real PCs. Than it became defacto standard and all others had to be "Intel compatible" Cyrix and AMD emerged as only viable "Intel compatible"choices. Since they all had to be "Intel compatible" logical thinking was "Why not buy original instead of (maybe) inferior copy if I can afford it".
Cyrix didn't last long due to weak co-processor but AMD continued to be viable alternative and still is.
Things were easier while all the processors worked in same MBs but since Pentium 2 nothing was same any more.
I used Cyrix in the beginning and switched to AMD somewhere in the times of 386 to 486 switch for performance's sake while Intel was above my practical use pricing and still is.
I'm still sticking with AMD for highly practical reasons, just don't need any more than what a FX 6350 properly OCed can give. I'm not saying that I wouldn't lave to have shiny new but ridiculously priced flagship i7 which is priced so just because there's no alternative right now but I would use just as much "power" as I'm using now with this system.

 

[Solandri]

Intel is near monopoly thanks to their being first with real personal computers. Before them processors were used in dedicated machines, There was Motorola and Zilox but none were used in real PCs.

The Motorola processors were used in the Macintosh computers. Its FPU generally outperformed Intel's FPU on the 80486. Pretty much anyone who programmed in assembly will also tell you Motorola's instruction set was much cleaner and better organized than Intel's. And the big-endianness makes more sense than Intel's little-endian (it matches the way you'd write byes or numbers on paper).

Intel is king of the CPU hill because of one and only one reason - IBM picked them to make the CPU for the IBM PC. Everything after was a snowball effect - high sales meant more profit, which meant more money they could spend on R&D (and for bribing Dell, HP and IBM not to use AMD), which helped them stay ahead of the competition, which led to more sales and profit.

 

[CountMike]

Yes, Atari St also used same Motorola processor. I also added an adapter with Macintosh BIOS to make my Atari 1040ST use Apple OS. As you said that chip outperformed Intel at least until 386 and I was able to run DOS in Atari by SW emulator that had better performance than best (20MHz) 8x86.
There were other Intel compatible chips even before 286. One of them was Tandy (Radio shack) 8888 processor at least on the par with with 8086.
I used such modified 1040ST (added HDDs to it) well into 386 era for Autocad compatible CAD program that was not only easier to use but also was 3D and run faster than on PCs of those times.