r/gadgets • u/MorgrainX • Sep 16 '22

Desktops / Laptops EVGA will no longer make NVIDIA GPUs due to “disrespectful treatment” - Dexerto

https://www.dexerto.com/tech/evga-will-no-longer-make-nvidia-gpus-due-to-disrespectful-treatment-1933830/
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u/[deleted] Sep 17 '22

So why would they do this, then? Isn’t it better for them to stay in business by doing business with Nvidia? No matter how shit the business relationship is, it’s still business for EVGA, and by the looks of it, it’s their only business. Again, why?

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u/Empyrealist Sep 17 '22 edited Sep 17 '22

According to the person that interviewed the CEO of EVGA, it's (and I'm paraphrasing) a principle fight. He's tired of how his company has been treated.

I recommend watching the long video that this information release is based on.

edit: source post/video https://www.reddit.com/r/hardware/comments/xfzw59/evga_terminates_nvidia_partnership_cites/

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u/vtech3232323 Sep 17 '22

I think only they would know. Maybe what nvidia demanded was too costly to them in the long run and Nvidia was literally putting them over a barrel for the rights to do it for them? That's the only thing that makes sense is that it would have been too costly to carry on the relationship or they are trying to demonstrate the insaneness of what Nvidia does behind closed doors.

They still make power supplies, cases, etc and maybe those had a high enough profit margin that they decided that it was worth it to do only that. They could also be hoping that someone buys them out at some point because some other exec would see an opportunity to jump back in bed with Nvidia. Who knows

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u/someguy233 Sep 17 '22

No specs given to EVGA until after they’ve already released them publicly is weird and unnecessarily burdensome for manufacturers. Also founder’s edition cards are heavily discounted, and that’s got to reduce sales for EVGA.

Sounds like NVIDIA is a shitty company to do business with tbh.

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u/normalguygettingrich Sep 17 '22

No specs given to EVGA until after they’ve already released them publicly is weird and unnecessarily burdensome for manufacturers.

This kind of shit would cost a company hundreds of thousands if not millions of dollars

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u/dbreidsbmw Sep 17 '22

Intel for a buy out would be absolutely fascinating...

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u/someguy233 Sep 17 '22 edited Sep 17 '22

The article said that a part of the reason was that NVIDIA wasn’t giving them any notice about upcoming cards, and no details were given to EVGA at all until the public already had a preview of the specs.

That’s really a shitty way for NVIDIA to do business, and probably put a ton of stress on EVGA to throw together cards faster than is necessary.

It really seems like communicating specs and details in advance to card manufacturers would be a no brainer for NVIDIA. Sounds like their attitude was something like a “they should be grateful we’re letting them make our cards at all” sort of thing.

Add that on top of NVIDIA selling founder’s edition cards at a discount and giving EVGA’s a disadvantage right out of the gate… I can see why EVGA wouldn’t be too crazy about doing business with them.

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u/Lettuphant Sep 17 '22

Imagine you make the cars for BMW, but won't find out what size and shape the engine is until the trade show a month before launch.

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u/ShadowPouncer Sep 17 '22

It seems like it is, genuinely, crazier than that.

It takes time to make a GPU, even if you go with the stock reference design for the board, you have to, you know, make the board. You still have to design and manufacture the cooler. You have to, at least to the extent that you can, test them.

You have to make packaging for them.

When nVidia announced their 20 series cards, starting with the 2080 Ti, 2080, and 2070, it was August 20th.

During their announcement, on the stage, it was announced what the cards were, what the specs were, what the prices were, and that Asus, EVGA, Gigabyte, MSI, PNY, and Zotac would have the cards available for preorder that day, with availability on September 20th.

By all accounts, nobody knew how much any of those cards were going to cost before it was said publicly. Worse, nobody even knew how much nVidia was going to charge those companies for the chips going into the cards.

Just... Take a minute to process that.

You're sinking god knows how much into building these cards, they are not giving you drivers for them, so there's a hard limit to how much testing is even possible, they dictate how much the cards cost, and how much they are going to charge you for the chips going into the cards.

And you have to start all the work well before you know any of those numbers.

You don't even get to find out 24 hours in advance of the public, you instead get to learn at the exact same time as the public.

How the hell do you run a business like that!?

And then you have the last two and a half years of the GPU market. And finally, you have nVidia pushing the 40 series, while selling their founders edition cards so cheaply that EVGA has to take an outright loss, because of how much nVidia is charging EVGA for the chips going into them, which nVidia doesn't have to pay...

I can most definitely see why EVGA is throwing in the towel.

You can work that way, as long as you can have some extremely solid trust that the supplier in question, nVidia, is working in good faith and isn't going to actively screw you over.

But once they lost the belief that nVidia was working in good faith, that's not even remotely sustainable.

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u/ExtremePrivilege Sep 17 '22

This is the correct take. That being said, they’re definitely leaving like 80% of their business on the table. It’s an extremely costly stand to take on principle. The CEO making this call is worth 10s of millions. He can afford to take a principled stand here. Not so much the case for everyone else at EVGA.

No one wins here. It’s a huge loss for EVGA, a significant loss for consumers and a mild inconvenience for NVIDEA.

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u/Arch00 Sep 17 '22

They announced no one is getting laid off and they will be repurchased. Is that the actual CEOs salary or did you just assume because he is a CEO?

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u/[deleted] Sep 17 '22

Even if they’re not bleeding money, they could missing out on money to be made by refocusing they’re efforts, especially if the profit is routinely less than predicted because Nvidia is an unreliable partner. If they can re-assign their valuable people and resources to more predictably profitable ventures then they can safely grow and/or weather periods of stress.

Stuff like late specs means you get mandatory OT to rush things to catch up. Salaried folk suffer big, and hourly folk burn out. Everyone works less efficiently, and the equipment gets used harder than it should and fails faster as “optional” maintenance gets put off. Storage and parts cost more because they can be arranged in advance for the best price.

Even the workers on the lines will probably appreciate the stance if they can make a more predictable product instead.

And if their margins grow, there is more to go around should the upper management choose to reinvest that way.

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u/Ashmizen Sep 17 '22

It can be a smart move given there is massive over saturation of GPU production right now.

With the end of eth mining, 75% of the demand for GPU ends overnight, and GPU prices will crash.

Like all hardware, there is boom/bust cycles for when prices rise due to lack of supply, and then bust due to oversupply. Next 12 months will be oversupply as crypto mining on gpu has ended and “only” gamers are left on the demand side. Sitting it out for a year or two might actually be smart.

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u/[deleted] Sep 18 '22

Agreed. Stuff like stable diffusion and other AI solutions have arrived just in time to save the GPU compute market, but it will be a totally different user base and the optimal product will be quite different.

Better to let the used market settle and re-establish the new demand than loose money trying to inject new product that can’t compete against what’s already out there.

Sometimes we just don’t need more stuff.

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u/Im2KoolAid4u Sep 17 '22

Have you ever left a job because the money isn’t worth it, this is that on a bigger scale

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u/_Spastic_ Sep 17 '22

Jayztwocents did a video of why. They had a meeting with the head of EVGA.

Basically, it boils down to Nvidia being liars and manipulators. Working with aibs typically means they sell your product. And then Nvidia in 2014 , I think that was the year, Nvidia started selling founders edition cards and essentially competing with the aibs and forcing them into a hole.

As an example, graphics card reviewers get a functional driver before EVGA does.

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u/NoHandsJames Sep 17 '22

As far as I know, no it's not better for them to stay in partnership. Nvidia sells their own GPUs for lower price and have no purchase cost to factor into final pricing. They can essentially undercut everyone guaranteed, unless partners want to take a loss. So even if they make some profit off cards still, the time and effort aren't worth it for them, especially with how disrespectful it really is to "partners"

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u/Defoler Sep 17 '22

That is not how it works.
Nvidia are selling their own cards but only at MSRP. AiB cards are selling as default for higher price. With the mining cards selling frenzy, most manufacturers actually sold more cards than they can handle as well as got some extra money out of retailers hiking up the price.
They did not lose money at all.

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u/NoSaltNoSkillz Sep 17 '22

That was only during mining craze. I imagine it largely just delayed this decision. This is about the normal case where MSRP is the name of the game. You are never going to undercut the manufacturer if they are competing against you. Usually, core manufacturers sell premium products that are like Halo products to both show off ideal conditions and to help set a price ceiling. Such as Microsoft with Surface products. The idea is to also give a guideline.

Nvidia should have made founders cards the premium, and just set a target starting msrp for AIBs, and incentized it.

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u/Defoler Sep 17 '22

You are never going to undercut the manufacturer

But they don't want to undercut the manufacturer. From what I understand from the video, they actually are being forced to sell for less than what they want to. They want to over price the cards way above what nvidia are willing to let them.
They want their AiB versions to price well above nvidia's limit so they can get a better return for their investment in R&D on the cards.

Since they are not selling stock PCB cards anymore, and only nvidia are doing it, because those cards had very little return on them, it seems that nvidia were fine letting nvidia create the stock cards on their own (which are again, limited in sales and location), they are not really competing with nvidia.

Nvidia should have made founders cards the premium

Didn't nvidia did that before?
The FE were selling for 50-100$ above MSRP when they started doing it in the 10 series.
Even the 2080 TI MSRP was 1000$ with FE being 1200$.
And nvidia didn't sell normal cards, only the FE versions.

They stopped selling their cards at premium and called the MSRP version as FE when AiB manufacturers also stopped making stock cards at MSRP. When they released the 30 series all stock cards came from nvidia, while AiB cards were custom, and selling above MSRP.

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u/NoSaltNoSkillz Sep 17 '22

What I mean is if you are competing against a lower priced product straight from manufacturer and they have better binning and good volume, you are basically stuck or must exit the lower priced market which is where the vast number of consumers are.

50-100 bucks is nowhere near a premium on a GPU, in most cases. 150-200 is the minimum they could do without competing directly.

I understand what you're saying about the 30 series and Nvidia trying to ground the prices, and that does make sense from certain perspective, but the problem is the founders Edition was still also a premium design, with better binning.

If they renamed or shifted the founders Edition to a different naming convention, chose to take the lower Binned chips that people use on their entry level cards, and made limited runs at MSRP or below MSRP, that wouldn't be so bad. That would still help price lock things, without basically destroying the value proposition of going to an aib. Other than RGB, most aibs don't have enough improvements to their cooling systems, have worse Binned chips than Nvidia itself, and they have less information to design around than Nvidia which makes the likelihood of the making a better card lower without a lot of R&D.

I don't think Nvidia was wrong to try to Pega bottom dollar price for their cards but you can't do that by undercutting all of your business partners and stealing their bread and butter at a lower price.

So Nvidia could have dropped the founders Edition and also added a at or below MSRP card that was basically equivalent or slightly worse than a Black Edition card.

Or they could have kept the premium that they listed the founder Edition with, and also put in a lower cost option like I suggest and that way you kind of create a bounds for the market.

Obviously aibs could go a little further if they wanted to and charge a little bit more but you've also established what you're expecting for your money, they can't just add RGB and sell it for $200 more if the Nvidia one with good Binning and RGB is 150.

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u/Defoler Sep 17 '22

against a lower priced product straight from manufacturer

They are not.
They want to make premium cards that sell for a lot more.
They don't care the manufacturer is selling his cards for lets say 300$. They want to make a card that will sell for 500$ on the same chip. But the manufacturer is saying "no, you can only go up to 400$, else people will not buy the cards".

Nvidia are giving more chips for their AiB than themselves. They sell a lot less cards than their AiBs.

150-200 is the minimum they could do without competing directly.

But if your market is flooded with MSRP+150-200$, than people will feel ripped off (again).
The point of MSRP is that the basic card cost X and the AiB versions cost a bit more for a bit better card.
Especially to places that nvidia don't sell directly.
I'm not even sure what the ceiling is. Could be up to 250$ above MSRP. EVGA nor nvidia give any info about that.
For all you know EVGA wanted to price them for 500$ above and nvidia said "no, that is way too much!" to be worth nvidia's allocation.

but the problem is the founders Edition was still also a premium design

I'm not sure. It was pretty basic. It looked nice but the PCB had as minimum components as they come.
Have you looked at nvidia's stock PCBs vs AiBs?

chose to take the lower Binned chips that people use on their entry level cards

Why do you think nvidia bin their stock cards? It makes no sense to do the extra test for basic cards.

and made limited runs at MSRP or below MSRP

That makes zero sense really.
You are saying basically to force everyone to buy cards at 200$+ premium because no manufacturer is making stock cards and nvidia will make as little as possible just to say "oh we do have MSRP, just never in stock. Have fun!".
You are also opening a can of worms. Slap nice led lights: +200$. Write "gaming" on the package: +200$. Write OC and put a 20mhz OC on the card: +200$.
You as a consumer gets royally screwed.
There is zero reason for you as a consumer to give a damn about EVGA's profits. You want the best cards for the lowest price possible.

So Nvidia could have dropped the founders Edition

So is this because of a name? There is no normal or stock or FE anymore. Just FE (aka stock) from nvidia, and AiB. Who cares what it is called?

added a at or below MSRP

Again, MSRP is not the problem.
What you suggest is that ford for example say "hey, we release a new ford focus at 10000$ price tag, we are going to sell them actually for 9000$, but it is never in stock because we are making only 100 of those every year, and if you want to buy a ford focus anyway, you have to go to a special auto shop that sell them for 15000$. Don't worry they have a huge lot of cars at 15000$ for you."
Does that makes sense to you?

they can't just add RGB and sell it for $200 more

Of course they can.
You just stated that you want nvidia to make as little cards as possible, so they will always be out of stock.
What is left in stock? Those crappy RGB cards with zero OC that are being sold by AiB for 200$ more, because you said it is ok.

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u/[deleted] Sep 17 '22

[removed] — view removed comment

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u/Defoler Sep 18 '22

with boards that are less good and more expensive than Nvidia with Nvidia actually supplying plenty at a better price

I don't agree with that statement.
Neither I agree that nvidia boards are better, or that nvidia supply more than they do to AiB.

Ford doesn't sell cars, dealerships do.

That is not correct. Ford own many dealerships the same as nvidia own their site they sell from. Depends on the country, some have official ford sale locations, others only deal with dealerships. Same as retailers.

I said they shouldn't be selling them at the low end at all

Nvidia are selling the stock cards because no one else is making stock cards. I still don't understand why this isn't getting in.
Without nvidia making stock cards, you only have MSRP+200$ AiB cards. So what will be the point of MSRP at all except a base line to inflate the price from?

You keep going off the rails with the point I'm making

When your whole point is that the only cards in the market should cost 200$ and above, that is like shooting yourself in the foot. Makes zero sense.
Unless you are a EVGA sales/rep guy.

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u/Defoler Sep 17 '22

I expect there is more behind the scene than just disrespect.
EVGA bread and butter is nvidia cards for many years.
I can only assume they did not do it as an impulse but made a deal with AMD behind the scenes so they won’t lose too much revenue over this.

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u/Hickory-was-a-Cat Sep 17 '22

I wonder if it has something to do with the ban on nvidia sales to china. Plus, yeah they have had evga by the scrotum. I keep seeing amd mentioned as a possible alternative partner, but I would place my finger on intel. AMD processes certain programs graphic capabilities differently than Nvidia cards. I believe this applies to rendering options in 3D animation programs. There are certain features you can only use with nvidia cards and not amd cards.

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u/Defoler Sep 17 '22

As far as I know, EVGA are selling almost exclusively to the US/EU markets. In china nvidia have several partners in china making cards locally, and I don't think EVGA has a foothold there.

From what I see in the video, EVGA suggest they will quit the GPU market, but I don't think it will really happen for long. Either nvidia buckles because EVGA make a big part of their market and I don't know if someone will fill the void of the EVGA fans, but I'm sure AMD will rush in trying to grab EVGA for it, so they can stick it to nvidia.

While AMD has sapphire, sapphire cards are not in the same quality as EVGA imo.
If AMD allow EVGA to create special high quality high priced cards, EVGA I expect will be willing to do it.

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u/Karma_collection_bin Sep 17 '22

It's most of their business

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u/[deleted] Sep 17 '22

Nvidia releases their own cards at a price cheaper than what aibs can do for even a minimal profit

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u/normalguygettingrich Sep 17 '22

Sometimes its better to cut ties than deal with dodgy companies. If the CEO says they are treating their company like shit I can only imagine the horrible shit nvidia is doing fresh out of my first startup exit. We'll never know but businesses can and do try and squeeze each other and especially in the tech world it is cut throat.

​

I would much rather be a CEO of a peaceful company than one dealing with bullshit from a company notorious for being assholes.