Why are PC parts so expensive in Australia?

why-are-pc-parts-so-expensive-in-australia

Why are PC parts so expensive in Australia? This is an issue that many gamers have had to deal with at least once in their life. There are tens, if not hundreds, of different components that combine to make up a computer. As you can imagine, each component has its own price associated with it. Combine this with the number of various part manufacturers and retailers online and brick-and-mortar stores around the country, and it becomes quite obvious that prices will vary from place to place without much explanation as to why.

In Australia, the world of high-end PC gaming is definitely not where anyone on a budget would dream of shopping. If you’re looking to build your own gaming rig, then be prepared to shell out some serious cash for the parts you need.

What are the reasons behind high price tags? Not surprisingly, it’s a mix of things that come together to determine how much you’ll be paying.

Demand vs Supply

The first reason has to do with demand versus supply. Basically, all marketers know that if they raise prices for no apparent reason or change the quality in any way, consumers will pay more for something simply because it’s the only thing available at the time.

The rise in popularity for PC components has resulted in increased interest by consumers who are looking to build their own gaming PCs or upgrade existing ones with new, “better” parts. Due to this increase in demand, certain manufacturers have started selling their products at higher prices than one would normally expect to pay for something which provides similar if not identical functionality as its competitors. While there can be many reasons for this situation, three major factors tend to stand out: the components are made in low quantities, they have high R&D costs, or the manufacturers are taking advantage of monopolistic market positions.

The result is that you end up paying a lot more for a product that might not even be that much better than a cheaper alternative. Worse yet, there’s very little you can do about it unless you’re willing to invest a lot of time and effort into finding the right deals. Even then, it can be difficult to get a good price on some components because of the way the market is currently structured.

Manufacturing costs

Second, comes costs associated with producing products and shipping them around to various locations worldwide.

Manufacturing costs are on the rise due to increased tariffs on goods imported from China. This has resulted in increased costs for memory, some of which have come in the form of higher retail prices.

Manufacturing costs are also on the rise because it’s getting more difficult to manufacture certain chips. For example, Moore’s Law is hitting a wall with ever-shrinking transistors, and this is causing problems for semiconductor manufacturers like Intel and TSMC. As they struggle to figure out how to continue increasing chip density while still maintaining reliability, they have to spend more money on research & development (R&D). And since semiconductors are an integral part of PC parts–PCs wouldn’t exist without them–this affects the price of PCs too.

graphics-card

Government regulations

Third, are government regulations that service providers have to deal with on top of everything else. And last but not least is competition between retailers themselves, which drives up prices as well.

If you’re looking for some good news at this point, there actually is some. While the price of one part may seem high, upgrading your entire system is still typically cheaper than purchasing a pre-built model off the shelf. All it takes is an open mind and a little bit of creativity to come up with ways of spending less on hardware while getting more out of it.

Market structure

One of the main reasons why PC parts are so expensive is because of the way the market is structured. A lot of the cost comes from companies taking advantage of their monopolistic or oligopolistic market positions. For example, Intel and AMD have a duopoly in the CPU market, which allows them to charge more for their products.

Monopolies

Similarly, Nvidia and AMD have a duopoly in the graphics card market, and Samsung dominates the memory market. These companies can get away with charging more for their products because there’s no real competition to drive down prices.

Compliance

Additionally, OEMs need to make sure their products comply with global safety standards, which means they need to test them in a variety of situations. This also requires additional spending, and it’s one reason why laptops tend to be more expensive than desktops.

Materials

Then there are the materials themselves. Many PC parts, such as graphics cards and CPUs, now require precious metals like gold and silver. The price of these metals has been going up in recent years, partly because of increased demand from the electronics industry but also because of speculation by investors.

Research and development

There are many factors that contribute to why computer parts are expensive, one of it is the enormous costs behind research and development. Big companies like Apple has really spent tons of money in finding out new ways to make their computers faster amd cooler every day! This costs big bucks to see where current technologies fall short or where they can be improved upon not only to improve speed but also for longer battery life while being used less often!

Infrastructure

Another reason why computer parts are so much more expensive than other technologies is because of the infrastructure in place. For example, where does your smartphone get its parts? It’s very much likely it came from China or somewhere else in Asia which makes it inexpensive for companies like Apple to produce them. However, there are only a few places in the world that can produce computer parts and they’re usually located in Japan or Taiwan. This means that you have to pay thousands just for airfare alone if you want to go see where the parts are made! And do you really know how much money has flown into building factories? Again, this costs big bucks so expect computer part prices to skyrocket even higher than they already are!

Patents and copyrights

In addition to the cost of labor, there’s also the issue of patents and copyrights. For example, if a company in the US invents a new type of screwdriver, it can apply for a patent to protect its invention from being copied by other companies. This is how American companies can maintain their high prices because no one can just go ahead and make their products without paying royalties. The same thing goes for computer parts; the manufacturers have to pay licensing fees to Microsoft or Intel in order to use their intellectual property (IP).

Conclusion

So while it may be frustrating that your new gaming PC costs more than a car, you have to remember that there are many factors involved in why they’re so expensive. It’s not just the parts themselves, but the research and development costs involved in making each new generation of hardware.