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This is such a boring, semantic argument NVIDIA’s products can colloquially be described as commodities in some contexts, as GPUs from NVIDIA can be interchang

This is such a boring, semantic argument NVIDIA’s products can colloquially be described as commodities in some contexts, as GPUs from NVIDIA can be interchangeable with GPUs from other manufacturers like AMD. For specific tasks like gaming or basic computing, the brand may not matter as much as the specifications, making them somewhat commodity-like in those scenarios Whilst this isn’t the traditional economic definition of commodity, speaking loosely, I think it’s fair enough to describe GPUs as a form of commodity. The important thing is what’s being communicated, not the semantic definition. The above comment’s point was pretty clear IMO

ZephyrBlu 3y ago
> as GPUs from NVIDIA can be interchangeable with GPUs from other manufacturers like AMD For AI workloads I'm pretty sure they aren't, which is why everyone is trying to buy NVIDIA GPUs. If they were a commodity there would not be such intense competition for NVIDIA GPU allocations, because they would be easily interchangeable with GPUs from another source.
fisf 3y ago
> The important thing is what’s being communicated, not the semantic definition. The above comment’s point was pretty clear IMO But the argument is, that Nvidia should follow a standard valuation model, since their product is a commodity. Those claims are both incorrect. This either rests on a misunderstanding of what a commodity is, or on a misunderstanding of Nvidias Position in the AI segment. As it stands at the moment, they are not a commodity in this field, they can not be replaced, and thus you cannot apply a more standard valuation model.
blackoil 3y ago
You are stuck on word commodity without understanding why it is important in valuation. What parent is saying some companies have no pricing power since there products can be replaced with close to 0 difference. Nvidia is not valued as a commodity because now and in near future people expect them to keep their superiority that allows them to charge 30000+ for one card.

ZephyrBlu 3y ago

> as GPUs from NVIDIA can be interchangeable with GPUs from other manufacturers like AMD For AI workloads I'm pretty sure they aren't, which is why everyone is trying to buy NVIDIA GPUs. If they were a commodity there would not be such intense competition for NVIDIA GPU allocations, because they would be easily interchangeable with GPUs from another source.

fisf 3y ago

> The important thing is what’s being communicated, not the semantic definition. The above comment’s point was pretty clear IMO But the argument is, that Nvidia should follow a standard valuation model, since their product is a commodity. Those claims are both incorrect. This either rests on a misunderstanding of what a commodity is, or on a misunderstanding of Nvidias Position in the AI segment. As it stands at the moment, they are not a commodity in this field, they can not be replaced, and thus you cannot apply a more standard valuation model.

blackoil 3y ago

You are stuck on word commodity without understanding why it is important in valuation. What parent is saying some companies have no pricing power since there products can be replaced with close to 0 difference. Nvidia is not valued as a commodity because now and in near future people expect them to keep their superiority that allows them to charge 30000+ for one card.