Video Perspective: GPU Shortages and Litecoin Mining Discussion

Subject: Graphics Cards | December 12, 2013 - 05:20 PM |
Tagged: video, amd, radeon, hawaii, r9 290, R9 290X, bitcoin, litecoin, mining

If you already listened to this weeks PC Perspective Podcast, then feel free to disregard this post.  For the rest of you - subscribe to our damned weekly podcast would you already?!?

In any event, I thought it might be interesting to extract this 6 minute discussion we had during last nights live streamed podcast about how the emergence of Litecoin mining operations is driving up prices of GPUs, particularly the compute-capable R9 290 and R9 290X Hawaii-based cards from AMD.

Check out these prices currently on Amazon!

The price of the GTX 770 is a bit higher than it should be while the GTX 780 and GTX 780 Ti are priced in the same range they have been for the last month or so.  The same cannot be said for the AMD cards listed here - the R9 280X is selling for $130 more than its expected MSRP at a minimum but you'll see quite a few going for much higher on Amazon, Ebay (thanks TR) and others.  The Radeon R9 290 has an MSRP of $399 from AMD but the lowest price we found on Amazon was $499 and anything on is showing at the same price, but sold out.  The R9 290X is even more obnoxiously priced when you can find them.

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Do you have any thoughts on this?  Do you think Litecoin mining is really causing these price inflations and what does that mean for AMD, NVIDIA and the gamer?

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December 12, 2013 | 05:47 PM - Posted by Anonymous (not verified)

The Nvidia cards are not good for mining cryptocurrancy typically. It's Suprising that their prices have jumped so much.

December 12, 2013 | 06:07 PM - Posted by Fetzie (not verified)

I'm guessing their prices have increased because nobody can find an AMD card for money nor love so they are moving to the only cards that are in stock, which in turn is increasing their price due to the increased demand and lower availability.

December 12, 2013 | 07:11 PM - Posted by Anonymous (not verified)

AMD needs to caution their channel partners, and reinerate AMD's manufacturer's suggested retail priceing policy, as well as the other legal issues surrounding manufacturer's suggested retail pricing!

December 13, 2013 | 04:43 AM - Posted by arbiter

i think its end retailers that are doing it. lacking supply + high demand === more $$$ they can get from the cards. Amazon does it I know for sure.

December 12, 2013 | 07:26 PM - Posted by Anonymous (not verified)

Damn I'm heavily invested in pork bellies, should I switch to GPU futures!

That being said GPUs are heavily used by commodity traders, money market traders, and computerised stock market transactions traders(down to the few nano seconds trading advantage can equal big bucks)

---Scrooge McDuck's EtherCoins is the next big thing----

December 12, 2013 | 07:47 PM - Posted by praack

ah well back to buying nvidia again.....

December 12, 2013 | 07:55 PM - Posted by Anonymous (not verified)

Forgot to note! AMD could easily open up a direct sales channel with the LiteCoin user/market and take the price gouging channel partners out of the loop! And SUE the price gouging retailers for damages to AMD's current/recurring/ecosystem sales/lost future/ecosystem sales, from gamers who are forced by unlawfull retail pricing, over to a competiting company! Big time FTC hammers will come down!

December 12, 2013 | 07:57 PM - Posted by Anonymous (not verified)

Why does Ryan have his braces on his head ?

December 12, 2013 | 08:13 PM - Posted by Ryan Shrout


December 12, 2013 | 08:47 PM - Posted by icebug

This is exactly what happened with the end of the 5000 series Radeon cards. Thanks to bit coin I didn't get a XFire set-up. although with micro-stutter I guess it didn't matter.

December 12, 2013 | 10:35 PM - Posted by Anonymous (not verified)

I'll stick with nvidia as I can not seem to source a laptop with a 120HZ REFRESH RATE DISPLAY with amd tech? WTF?

December 12, 2013 | 10:51 PM - Posted by pdjblum

I guess this was AMD's answer to g-sync. I'll take g-sync.

December 12, 2013 | 11:30 PM - Posted by MahoganySoapbox

I've been tinkering with Litecoin mining with the extra cards I have laying around. Everywhere I turn for information I see the Litecoin guides and forums have hordes of people clamoring to scoop up all of the 7970's and R9 cards.

I'm laughing with you guys. I can't imagine building the rigs I've seen with six, twelve, or even more cards all running at full-bore. I had thought that I had an armful of ATI/AMD cards laying around & I should play with them. This really is crazy to see the pricing skyrocket around the Tahiti & Hawaii cards.

I'm in agreement that this is going to drive enthusiast consumers to the Nvidia product range this holiday season. Also that Google Glass is awesome. My coworker has one and I get to toy with it often. Much more enjoyable than the smart-watches... until the smart watches have Tetris.

December 13, 2013 | 12:48 AM - Posted by Anonymous (not verified)

In my opinion, AMD bashing craze is reaching all time high on, and

Too many crazy opinions...twisting facts.

December 13, 2013 | 04:51 AM - Posted by arbiter

um i wouldn't say its twisting facts. AMD put out a card with a crap cooler and marketed with this "Up to" bullshit as ryan called it and I agree. They damn sure known that cards wouldn't reach that up to speed cept for only first 5 minutes til their crap cooler couldn't keep up and card had to slow down. Then throw on top of that all the press cards seemingly are ~15-20% faster then retail bought cards, as if AMD didn't know anything about that. yea they pushed a fan rpm bump to try to fix it but now a loud card is even louder. AMD was so busy trying to beat Nvidia any way they could they got cheap on R&D for a cooler to cool the card. Now 3rd party card makers have to bail them out. With amd adding full setup to let these cards mine fast is kinda double edge sword for AMD as people buy up all cards for mining, it jacks up prices and end gamers that are not tied to either side will pay more for a card. Then in say 1-2years all these card that are half dead from mining will flood back to market and AMD will take another hit from it.

December 13, 2013 | 02:56 AM - Posted by kristoffertrolle

Might be true that this is actually hurting AMD. But I also think it's benefiting them in some areas. Now these people know that if you want kick ass gpu computing power then you pick AMD. I know Nvidia have Cuda, but I never see any programs supporting it, except for very big commercial programs. Opencl is getting more and more support. That has to be a plus for AMD?

December 13, 2013 | 04:52 AM - Posted by arbiter

Well gamers will buy what ever is cheaper. Really in game side there is no real massive performance difference between amd and nvidia. With increased prices of amd card it will push gamers lookin to upgrade to nvidia.

December 13, 2013 | 03:27 AM - Posted by JohnGR (not verified)

Ryan what are you talking about? Really. I mean AMD is selling cards and you are making it look like something that it is.... bad? Well, OK 10 or 20 or 100 thousand gamers will go to Nvidia. So? 4 million by now people learn that their XBOX or PS4 is 100% AMD hardware. It is not Intel or Nvidia. Not to mention that those who are exposed to Shield, Geforce Experience, Shadowplay and whatever, will NOT get exposed to bad drivers, variability in gpu speed, loud coolers, tearing and stuff that the press is using to attack AMD. Right? Riiiiiight....
And who really says that a gamer is loyal? And who really says that the miner is not also a gamer or that the miner will not become a brand new gamer after he moves to other hardware for mining? Who says that AMD will not get extra market share in 6-12 months when all these cards start selling as second hand hardware at very attractive prices? People, sorry, GAMERS who would have to chose between AMD and Nvidia hardware in 6 months for example will go straight to AMD hardware because miners, those who are not gamers or don't want to become gamers, will be selling these cards at really low prices. But yes, that's ALSO bad right? Right because selling too much hardware today it is bad for business tomorrow. Especially if you want Mantle to have an even bigger user base. Right? Right again.

So what we learned today is that AMD selling cards it is bad for AMD's business.
I hope my English are worst that I believe and you didn't say I didn't understood right.

December 13, 2013 | 03:35 AM - Posted by JohnGR (not verified)

I managed to prove that my English are worst than I thought in the last line... lol

December 13, 2013 | 04:55 AM - Posted by arbiter

"Who says that AMD will not get extra market share in 6-12 months when all these cards start selling as second hand hardware at very attractive prices"

you realize that running a gpu as hard as miners do, anyone with half a brain won't touch the cards. you don't know how short the life of the card is after being run max load from almost 1 year straight. AMD may claim 95c is within normal operating temp for 290 card but that temp does no favors for life span when running at it long term.

December 13, 2013 | 05:10 AM - Posted by JohnGR (not verified)

Damn, I though I was replying to you post but in the end I was doing a new one. My answer is under this reply.

December 13, 2013 | 04:37 PM - Posted by mLocke

Let's not forget the minor fact that AMD won't see a dime from retail price hikes or the sales of used cards. It might, in some roundabout way, be beneficial to consumers, but all of this demand does no favors for AMD. The hype for these cards is just as volatile as the crypto-currencies they're being used for.

December 13, 2013 | 05:08 AM - Posted by JohnGR (not verified)

I think many will touch those cards. First of all we are not talking only for Hawaii chips, but also for Tahiti. Second, and much more important, not only I would touch those cards, I would gladly buy them. Why? Because those cards will still have guarantee. SO? If a used card that was mining 24/7 comes with 1 or 2 years guaranty why not buy it? Not to mention that other cards that only do a few hour, hours not days weeks or months, of gaming and benchmarking could be in worst condition than these mining cards. Why? Because the guy that used them for just a few hours could have overclocked the cards to the roof, raised the voltage as far as he could and in just a matter of hours did much more damaged to the gpu than any miner could possibly do. Not to mention that most mining rigs I have seen are open boxes from every angle you see them. So those cards maybe where also working in almost perfect conditions with plenty of ventilation something that it is not always the case for gaming setups.

December 13, 2013 | 09:44 AM - Posted by Ryan D. (not verified)

Man you don't know anything about overclocking GPU's do you.
Miners overclock as well so your point is void!
Nobody will buy those miners cards period. And warranty? lol it's bought secondhand without the receipt etc which you need to proof your warranty etc.
I bought secondhand cards from close friends and they didn't even have the receipts etc anymore for me to claim RMA.

December 13, 2013 | 10:11 AM - Posted by JohnGR (not verified)

I know nothing and you know everything I guess.
And who really cares if you buy cards that do not have warranty? You think that everyone in the world follows your logic? And even if someone do buy a card that is not covered buy warranty you think he will pay the same amount of money that he would pay for a card with warranty? Give me a brake...

December 13, 2013 | 09:53 AM - Posted by Anonymous (not verified)

The cards come with a warranty but manufactures don't have any for ones that are seriously damaged. I had a buddy send in a Gigabyte 7950 that was having lots of problems and they sent him a 7970. It works but less desirable because of increased power use and heat. I sent in a 7950 with a bum fan and they sent me back the same card with a new fan which was nice.

December 13, 2013 | 10:13 AM - Posted by JohnGR (not verified)

They give you the same if they have one or another with the same specs or better. This is typical policy.

December 13, 2013 | 01:13 PM - Posted by MahoganySoapbox

This appears to have strayed to a conversation of whom would purchased the used goods? How is the potential to move more units in a quarter bad news for AMD?

I believe the segment above was to elicit concern from the public that the New-In-Box units that are being shipped are not reaching a consumer base which has a loyalty to the family of products and services which AMD and their partners offer.

Joe Schmoe may be building a Litecoin mining farm and require 24 R9 units before the holiday. This looks great to AMD's quarterly figures. However, their sale of those units and thus profits have been attained once they leave warehouse for the vendors. Any mark-up that the vendors apply due to demand in the market is unlikely to be sent back to AMD as a profit. Rather, the consumer markets they would like to penetrate through aggressive pricing and bundles has been undermined by this pricing mark-up. A "new" customer may have been lost, and, as the crew said, this is the deleterious result of the Litecoin mining craze.

To follow through on my first question of whom would be purchasing the second-hand goods; harm of reputation to AMD and partners can arise from the later influx of used goods. Another reader has pointed out the fact that they are comfortable applying for an RMA process to replace the possibly damaged unit. While this is a reasonable conclusion it does not address the public and long term issues this can cause for AMD and vendors.

So often these days we use social media to convey our thoughts, opinions, blessings, grievances, and pictures of our food. A year from now, or sooner, owners of second-hand units may be taking to social media to exclaim, "My graphics card blew up! AMD or (vendor name here) better be replacing this fast. My whole room smells like burning circuits!"

Follow that with a half dozen retweets or replies about how X brand is better than Y brand and you have a toxic opinion out in the ether and not due to any negligence on the part of AMD or their vendors.

~end Soapbox

December 13, 2013 | 01:24 PM - Posted by JohnGR (not verified)

I think that most people here and PCPer is trying to figure out what is the worst case scenario for AMD and then consider it as the most likely to happen.

The only way to argue these scenarios is to build a time machine, go one or two or maybe tree years in the future and bring back hard evidence that these worst case scenarios never happen. That;s the only way.
Anyone with a time machine?

December 15, 2013 | 12:36 AM - Posted by Anonymous (not verified)

NVidia fanboys know the future. They are now saying that Maxwell GPUs in Q1/Q2 2014 are going to be an awesome GPUs.

"4 Weeks with Radeon R9 290X CrossFire"

"Am I going to pull 290X CrossFire out and put the TITANs back in? No. Radeon R9 290X CrossFire is a beast for gaming! I love it."

Non-reference cards will reduce the heat and noise issues.

December 30, 2013 | 05:41 PM - Posted by bigedmustafa (not verified)

This supply shortage for high end Radeon cards should be short term. AMD and its partners will increase production until inventories and availability are restored to normal.

What makes the market impact of scrypt coin mining so dramatic is the sheer number of video cards that mining rig operators are buying. I've read accounts of individuals buying them by the half-dozen or dozen.

Interestingly, there is almost no effect on the Radeon R9 270X and below. All of the mid-range and entry level Radeon cards are still readily available at their suggested retail price points.

Gamers can still buy Radeon and get excellent performance and value at price points $229 and under. High end gaming enthusiasts will simply have to buy Nvidia until AMD and its partners can increase supply to meet demand.

If AMD's biggest problem is that they can't supply enough GPUs to meet the huge, crushing demand for their product, I don't believe it will hurt the company in the long term.

The more interesting question is whether or not Nvidia will spend a little bit of R&D time working with the crypto-currency community to optimize CUDA mining and improve their own product's performance and market viability.

AMD is selling video cards by the shopping cart load, and Nvidia is selling them one or two at a time. The rising tide of video card sales is helping both companies, but I can't imagine that Nvidia wouldn't like to share AMD's problem with over-demand.

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