So, what went wrong for NVIDIA this time? Even though the company had little control over the shortage, they could have definitely improved the stock situation and distribution within a matter of months, if not weeks. Here’s everything NVIDIA can learn from the Ampere GPU launch to avoid similar situations in the future.
1. Preventive Measures to Handle Bots
NVIDIA knows how fast its graphics cards fly off the shelves. It has experienced similar shortages before. The issue with online distribution is that scalpers use bots to order graphics cards almost instantly when the sales begin. The rest of us normal people have minimal chances of successfully placing an order at this point.
What’s the point of refreshing the site until the sale goes live if the cards go out of stock within seconds, anyway?
NVIDIA could have easily dealt with the bots using a Captcha system for every online purchase. If the bots had to enter a captcha every time they added a GPU to the cart, people would’ve had a far easier time placing an order. Yes, the NVIDIA online store added a captcha system a couple of weeks later, but it was already too late at that point.
Read More: How Do CAPTCHAs Work and Why Are They So Difficult?
Besides the captcha system, NVIDIA could’ve limited sales to one unit per customer on launch day. This would’ve prevented scalpers from placing bulk orders on the site. Once again, the company addressed this issue in a couple of days, but the situation was already worse by then.
2. Keep a Buffer Inventory
As a company that sells physical goods, it’s always good to keep a buffer inventory to combat these situations. NVIDIA could’ve kept additional stocks and sold them at a later date. Or, it could have simply blocked a portion of the existing stocks from day one sales and distributed them through different channels.
Let’s say NVIDIA had 1000 units of the RTX 3080 on launch day. The company could have listed 500 of them on the store and then released the remaining stocks in a phased manner so that people had better chances of getting their hands on one.
The demand surpassed the expectations in the Ampere GPU rollout. However, NVIDIA could have anticipated this, considering they’ve dominated the graphics card market in recent years.
3. Don’t Release GPUs in the Middle of a Pandemic
The COVID-19 global pandemic is one of the biggest reasons for the GPU shortage in 2020. Most people playing video games or doing all their work from home thansk to lockdown regulations. It was the perfect time for people to upgrade their PC hardware like webcams, monitors, processors, and whatnot.
Unfortunately, COVID-19 brought about a global chip shortage that affected several industries, including the GPU market. The trade war between China and the United States worsened the situation, and big names like Samsung and TSMC had to resort to other manufacturing plants for chip production. This chip storage was so bad that it even affected car manufacturers.
Read More: Why Is There a Global Chip Shortage and When Will It End?
Considering these points and the fact that manufacturers scheduled next-gen consoles to launch the same year, NVIDIA could’ve postponed the release of the Ampere-based GPUs by a few months. The existing graphics hardware was already good enough for most purposes, but NVIDIA stuck to its biennial schedule and launched the next-generation GPUs, regardless.
4. Release Lower-End Models First
One mistake we think NVIDIA made with the RTX 3000 series launch is that it released high-end models like the RTX 3080 and RTX 3090 first. Both these models use the same GA102 silicon die, but there’s a massive difference in pricing. And if you ever wondered why, this is mostly because of a process called chip binning.
NVIDIA uses the higher binned GA102-300 dies in the RTX 3090, whereas the lower tier dies to make their way to the $699 RTX 3080. Binning is a time-consuming process, and if the demand is massive for these high-end cards, it will affect the overall production. However, this wouldn’t have been a problem if NVIDIA started selling the lower-end cards first since they’re far easier to make.
In this case, NVIDIA could’ve launched the RTX 3070 and the RTX 3060 Ti models first and then gradually rolled out the RTX 3080 and RTX 3090 in phases. Hopefully, they learn from this situation and follow a different launch strategy with the RTX 4000 series GPUs.
5. Keep Miners Away with Low Hash Rate
The cryptocurrency market saw a bullish phase for most of early 2021, which worsened the stock situation for gamers. People invested in mining cryptocurrencies like Ethereum flocked to get a hold of any available graphics cards, further skyrocketing prices set by scalpers.
NVIDIA’s initial response was the RTX 3060 graphics card with a halved hash rate. A few months later, the company implemented this hardware limitation on all newly manufactured RTX 3000 series GPUs except the flagship RTX 3090. NVIDIA labels these cards LHR or Low Hash Rate so that customers know exactly what they’re getting.
We assume NVIDIA will follow a similar strategy with hash rate capped graphics cards to keep all the miners away for the next GPU launch. Getting more graphics cards into the hands of gamers is exactly what we need today.
6. Inform Customers of the Stock Situation Beforehand
NVIDIA can be transparent about the stock situation with its customers before launch day. This will allow people to have realistic expectations and avoid wasting time trying to place an order. The company could roughly indicate the number of Founders Edition units in stock, or the GPUs distributed to Add-In-Board (AIB) partners like MSI, Asus, Gigabyte, etc.
It’s always better to keep the consumers’ expectations low rather than hyping up the product and launching to negative press across the globe because of stock shortage.
NVIDIA Should Take Note From the RTX 3000 Series Launch
NVIDIA made several mistakes with the Ampere GPU rollout, but things are getting better now. Production has ramped up since the government lifted the restrictions, and the new LHR graphics cards have done a great job at fending off miners. Hopefully, the company reflects on its mistakes and learns a thing or two to prepare for the launch of its next generation of GPUs.
