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Do enthusiasts get ripped off?

Posted on 7th Sep 2009 at 10:40 by Mark Mackay with 22 comments

Mark Mackay
As just about every bit-tech reader will know, hardware that falls into the ‘enthusiast’ bracket often carries a fat price tag. People who take hobbies seriously are - more often than not - willing to invest serious amounts of money in them and hardware enthusiasts are no different. But are manufacturers taking it too far with their pricing of enthusiast products?

The most notable and long-standing enthusiast product might well be Intel’s Extreme Edition CPUs. They’ve certainly got the cool name and the bragging rights that inevitably come from such an exclusive price tag. I wonder how much it costs Intel to actually unlock the CPU multiplier? Clearly, that's not what you're paying for - so Intel also claims that the chips are taken right from the centre of the wafer where the silicon is purest, harbouring fewer miniscule imperfections which could potentially lead to instability when pushing overclocks to Timbuktu and beyond.

Do enthusiasts get ripped off? Do Enthusiasts Get Ripped Off?
The Asus Rampage II Extreme is arguably the pinnacle of enthusiast motherboard design. But does it give us our money's worth?

Another example of pricey 'enthusiast' kit might be MSI’s N260 GTX Lightning or Razer’s Mamba mouse. The Mamba was a hell of a mouse but when it comes to value it's little better than atrocious. I'm not denying companies need to, and should be looking to, make profits, but I can't be alone in suspecting that the mark-up on the Mamba is probably a good deal higher than on some of Razer's more mainstream models.

Perhaps it's not all that surprising that a top-end product has a fat profit margin on it. I'm sure Ferrari and Lamborghini make more margin on their cars than Ford does on its latest Fiesta, but I do think the rampant over-pricing of enthusiast kit means there's an opportunity to be taken. Not all performance cars cost the same as a Ferrari - hot hatches, for instance, offer speed without the luxury trimmings to keep their prices slightly more sane - so why doesn't a hardware firm make a line of products where the focus is on delivering maximum performance at as reasonable a price as possible. Forget the fancy packaging, forget the gimmicky widgets and screw the fancy paint jobs and novelty heatsinks.

Sure there are a lot of people who want all these trimmings, but there must considerably more that want rapid kit without spending on money of boxes that are going sit under the bed collecting dust or features that they’ll never use. Considering that most hardware publications benchmark most hardware and rate the all important price to performance ratio as paramount, such a product line would soon make a name for itself in the community.

22 Comments

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tron 7th September 2009, 12:45 Quote
It probably costs intel 5 pence to unlock the CPU multiplier. Intel are probably the worst when it comes to the rate of overcharging for their extreme processors.

I don't mind paying for higher profit margins on enthusiast products. The economy of scale there is that the enthusiast products sell much less, so you would expect the sale price to be a lot higher than the mainstream products. However, I think some companies such as intel take it too far.

If I buy a Lambo, I would want it to be expensive so that everyone isn't driving the same car. An intel 'extreme' processor wouldn't be very special if it had a mainstream friendly pricetag and almost everyone owned it. But I think, in terms of value, that some enthusiast products are not worth buying.
Sir Digby 7th September 2009, 13:28 Quote
AFAIK Intel did just release a new budget C2D processor for the Asian market with an unlocked multiplier - 6300K I think...
[PUNK] crompers 7th September 2009, 13:40 Quote
for me its about intelligent buying decisions, the Q6600 is a perfect example of top level performance with a little bit of tweaking at a bargain price. the 920 being the modern equivalent

there will always be people who just buy the most expensive piece of hardware on the day it comes out. to me they generally know less about hardware though, not more. does this make them enthusiasts? i'd argue it just makes them rich.
damienVC 7th September 2009, 13:46 Quote
The home PC market is very much a 'luxury' market in the main, and therefore it will suffer from the same vagaries as any other supply and demand led economic model. As long as people are willing to pay, and there always will be those who have to have the latest, best and most expensive kit, the the companies will supply to that market segment. It may be a small one in relation to the 'normal' consumer, but the profit margins will be bigger as the return on investment is so much more. The enthusiast segment of any market will never be a cash cow, but the odd rising star will surprise us all.

3 years studying for an MBA and this is the only time I've used it! Thanks for making it all worthwhile...!!
Xtrafresh 7th September 2009, 13:57 Quote
i think those products are already in place. The Biostar P45 motherboard for example, or the entire P55 platform vs the X58. The Club3D 4870 OC edition vs. the fancypants Asus TOP one.

Basically, you pay for exclusivity, performance and extra spoilers and exlcamation marks on the package. If you don't want to, you buy stuff that is less "awesome", and delivers on either on of the above.
mjm25 7th September 2009, 14:07 Quote
the main issue as a consumer is buying what you can afford versus what you want.

my friend and i have debated this about cars for years, how can you buy a car for performance when you know that there is a a model up the ladder that can trump you. The perfect example is with the previous gen Fiesta and the Zetec S versus the ST. everyone wanted an ST but could only afford a Zetec S plus the insurance, running costs etc, yet it kills you when you see that ST outdragging you on the motorway.
most companies will price these models close together so people try and make the smallish financial leap to get the better product... Intel just says FU to that and makes it double price, and good on them!
wuyanxu 7th September 2009, 14:42 Quote
i think only the uninformed enthusiasts gets ripped off.

a well informed system builder will go for something less such as standard p55 vs ROG series, DS4 vs DQ6 and still maintain the overclocking capability.


being enthusiastic is NOT about owning the most expensive gear. it's supposed to be about able to squeeze the most out of what you can afford.

with large company such as Intel and Asus aggressively marketing their highest margin products, many rich people are mis-informed and thinking owning an extreme CPU means they'll get extreme performance.
yakyb 7th September 2009, 15:03 Quote
http://www.codinghorror.com/blog/archives/001293.html

and

http://www.joelonsoftware.com/articles/CamelsandRubberDuckies.html

are two interesting articles when talking about pricing structures

maybe not quite relevant to this but it discusses steam in some depth
Jack_Pepsi 7th September 2009, 16:07 Quote
wuyanxu nailed it on the head - the enthusiast that I am is getting something for nothing by using, if the manfacturers like - inferior products. I can't afford the high-end enthusiast boards and I'd rather have stability over features and pretty colours anyday.

Saying that though, I am one for board aesthetics so I may be slightly hypocritical in some aspects - nothing wrong with having a little bit of style though is there?

;)
sear 7th September 2009, 16:15 Quote
The reason there's such a big mark-up on enthusiast products is because profit margins on other sectors of the market are so slim - competition requires you price your goods right, and that may mean you make very little money on each sale. When it comes to OEM stuff, I'm sure Dell and HP all expect discounts at certain purchase points, as well. They're stuck - manufacturers can come out with more expensive, premium hardware, but they can't lose money on it, and they need to make up for low margins elsewhere.
TGImages 8th September 2009, 19:20 Quote
The markups will be there as long as enough people are willing to pay for them. I used to be in that group. I had to have the newest, fastest, etc. All it did was cost me a log of money and 6 months later I could buy it for half of what I had spent. Stop paying those premiums and they will stop trying to sell at that price.

I finally gave up and realized I don't NEED the latest. Now I buy what I need, not what I want and I still have decent performing systems but at a fraction of what it would have cost just a few months ago.

PCs are one area this is different from a car. You can buy an expensive car and assuming you don't beat it to hell, much of what you spent can be recouped when you sell it... and they don't keep dropping the price on that new car in half every 6 months artifiicially devaluing your recent purchase.
thehippoz 8th September 2009, 21:12 Quote
cutting edge stuff always is way overpriced.. and it obsoletes so quickly.. I look at it like, you can either afford it or not, and if not you made a bad buy

I bought one of the very first video capture cards that could do 30fps at 640x480.. it was made by a company called orchid back in the 90's- I was doing video editing and morphing tricks around 1994 XD along with digital audio on a 486 with a 16 bit sound card (this was way before the jesus jones album that was mixed digitally on the computer instead of dat tape

it cost me almost 700 bucks remember.. couldn't been 4 months and it was obsolete by a mile lol I'll never do that again
antaresIII 8th September 2009, 21:16 Quote
Quote:

Yes; in every respect and way. :D
docodine 9th September 2009, 00:21 Quote
...This all exists, overclock chips like the E5200 or Phenom II X2 550 and you get performance from non-cool CPUs.
Star*Dagger 11th September 2009, 19:59 Quote
I have no problem paying extra, like for the G15 keyboard. But the EE from Intel is just gouging. That is where I draw the line. I buy graphics cards that I have a feeling will be good investments, ie the 8800gtx and the 4870x2, both of them were awesome.

I think as an enthusiast we usually have more money to spend on the hardware that is Elite and that allows the companies to charge such high prices.
I do not feel ripped off when the company makes a great product, even for a high price.

Yours in Elite Plasma,
Star*Dagger
Spaceraver 11th September 2009, 20:38 Quote
If I could afford a brand new Mercedes E 320CDI with all the bells and whistles I would buy it without blinking. But alas I can't. So I bought a used Mercedes 250D from 1986. More or less the same thing.

But then again. Bought a brand new Classic Army G36C and have upgraded it with more expensive new parts in less time than I have used it. Systema stuff is pretty expensive. Try buying a Systema PTW. Other than that. They only do M4's and MP5 models. :/
leslie 11th September 2009, 21:41 Quote
Look at the prices then see where the price takes a huge jump. Buy the one just before the price jump, this gets you most of the speed of the top of the line, with less than half the cost.

Spend what you save on more ram and a better video card. Processors are not the end all/be all in performance anymore. Truth is, they haven't been for a very long time.

It doesn't pay to lead.
When I bought my 9550, the 920 I7 was just out. It was extremely expensive, as were the boards (which were still buggy). I went 9550 because it was far cheaper, stable, and plenty fast. Processors are no longer the end all, be all in performance. I took that money I saved and bought more ram and a better video card.
Elton 12th September 2009, 03:40 Quote
"Enthusiast" stuff is really just overpriced.

Especially when you consider that there are much cheaper mid-range options that are near Enthusiast levels.
Ending Credits 12th September 2009, 11:00 Quote
Quote:
so why doesn't a hardware firm make a line of products where the focus is on delivering maximum performance at as reasonable a price as possible.

DFI.

Pity they haven't made anything good in a while.
Elton 12th September 2009, 16:52 Quote
Quote:
Originally Posted by Ending Credits
DFI.

Pity they haven't made anything good in a while.

Ah. Their Legendary NF4 boards...
H2O 12th September 2009, 17:27 Quote
Quote:
Originally Posted by Ending Credits
DFI.

Pity they haven't made anything good in a while.

My DFI X48 LT T2R is pretty good, the BIOS is amazing!

Same they can't make a decent color scheme, though.
dec 20th September 2009, 01:45 Quote
AMD Black Edition

too bad intel hasnt gotten that hint yet
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