Computer Prices, Why are They so High?

By Candi Jahn
•
07 Apr, 2021

In the last two years, prices for everything have increased not only due to the usual supply and demand, but for a multitude of reasons. Many reasons simply boil down to how the world is being affected by Covid, but we also have to deal with: Crypto-mining, bots and resellers, and taxes.

I know I’m not the only one tired of hearing about the Coronavirus, but the restrictions placed on companies and everyday people are the major factors to our massive price hikes in the last two years. With people staying home, companies closing, and items not being produced; supply is decreasing and demand is increasing.

Families are finding themselves seriously under equipped when trying deal with new scenarios like online schooling, working from home, and day-to-day entertainment. Most families have never really needed to have more than one computer and could easily divvy up screen time, but now kids have to attend classes, parents have to work, and we all need entertainment in-between. Having only one machine is no longer realistic.

Companies whose employees are now at home, are tasked with supplying equipment like: Computers, webcams, software, and anything else their employee might need to get their day-to-day tasks done. Meetings are no longer attended in person unless absolutely necessary, project files are e-mailed or sent through the cloud, and things aren’t looking like they are going to change even after Covid is successfully managed. The convenience of not having to be in the workplace to still get work done is unmistakable and could reduce many businesses operating costs long after Covid.

If you’re one of the lucky businesses, you are still open and operating as usual, but many companies, especially technology, manufacturing, and distributing companies, are operating at a diminished capacity or not at all. Companies who are manufacturing technology have also shifted what they are making and who they are supplying. Getting computers to schools and global businesses is priority number one, smaller businesses and everyday consumers are going to have to wait. Schools are going to need Chromebooks for their students and businesses need the higher-grade Enterprise machines. With the shift in need, items we used to be able to get fairly easily are being made less and are distributed to places that are willing to pay top dollar. If you need something for your home or small business, finding it maybe difficult and you may even be put on a waiting list.

Crypto-Mining is not new, but with record high dividends in the last two years, everyone and their brother is trying to get in on the action. How does that effect the price of computers? It’s the graphics card folks. One of the easiest Crypto methods, requires a great graphics card. You will see prices of graphics cards a minimum of 25% more expensive than they originally were. Even older Cards’ prices are soaring. Some of this is being fed by the decreased output of the cards, but we also have the purchasing bots and resellers to thank.

Bots and resellers are training themselves in how to scoop up the most in demand components and selling them to the highest bidder. Usually, everyday people are not going to be able to afford these prices and that component will just be bought by another reseller hoping to make a quick buck by driving up the market even further.

Finally, we have the new import taxes, tariffs, and restrictions. China is one of the biggest tech producers, so when Covid hit and China stopped shipping, or at least when we stopped receiving, our supply was severely diminished. After restrictions, like the two-week waiting period for unpacking shipments, were passed, things started looking better, but in December 2020 the tariff exclusion for Chinese imports expired. After this expiration, import taxes ranged from 7-25 percent and those cost increases were passed directly to the consumer.

All of the turbulent conditions are conspiring to keep costs high, but don’t lose hope. Management of the Coronavirus has allowed many schools and companies to resume in-office environments, Online retailers are cracking down on bots and resellers by enforcing price restrictions and captcha testing, and technology manufacturers are making more or specialty Graphics Cards to reduce strain from Crypto-miners. I can’t say when prices will go down, but I can say things are starting to get under control.