What just happened? As the third-party market for new consoles and computer hardware continues to flourish, some are beginning to question whether the traditional sales channels should be discarded. In a recent Twitter post, John Carmack, co-founder of id Software, said it would be better if we got a “transparent auction system directly from the manufacturers and a more efficient market.”
“There will be a lot of outrage at the reported prices outside the gate, but the removal of intermediaries should ultimately be better for consumers,” Carmack added.
Given shortages and speculations about things like 3090 GPUs and new consoles, it looks like we would really be better off with a transparent auction system directly from the manufacturers and a more efficient market. The world of sales channels has prevented this in the past, but we
– John Carmack (@ID_AA_Carmack) 19 February 2021
There’s a lot to digest here, so let’s take it a little at a time. For those who have yet to keep up with the gaming and hardware markets, both have multiple retail issues that stem in part from:
Carmack is not wrong in thinking aloud about problems currently affecting consoles and computer hardware, but the solution he offered has many flaws.
Selling directly to the consumer by auction will effectively eliminate the scalpers, but it can not solve anything on the part of the buyer. In stock there will still be a shortage and prices will still be well above retail. The only difference is that hardware manufacturers will earn the extra profits instead of individual scalpers.
This opens up a whole new look of worms. Suddenly, Nvidia and AMD get all the criticism and negative press for high prices, not scalpers. You should also be concerned about the risk of artificial stock shortages. What’s more, it will require a complete restructuring of the sales process.
Manufacturers have one task: to make products. Selling goods directly to customers is not part of their job description, and without experience it would probably not be very good. It reminds me of a line from comedian Mitch Hedberg: ‘It’s not fair, you know? It’s like I was a cook, and I worked my ass off to become a very good cook, and they said, ‘Okay, you’re a cook … can you farm?’