Newegg.com Ripoff Alert
I’m in the process of building a new PC to replace my now-seven-years-old-and-upgraded-too-many-times-to-count-Athlon-2400 box. So when I heard that this week was going to see big price cuts on new Intel CPUs, it was music to my ears.
Specifically, it was music because it would be the first time a quad-core CPU would actually be affordable by normal human beings. Intel’s Core 2 Quad Q6600 CPU used to cost more than $500, which is pretty lofty considering that you can build an entire PC for $800 these days that will do everything you need. But the price cuts knocked that part down by more than 50%, bringing it to the much nicer price of $266. At that price, you can actually consider building a system around it without breaking the bank.
I typically buy computer parts from Newegg.com, so I cruised over there to see if they had any Q6600s in stock. Turns out they do — but at Newegg, the $266 chip is being sold for $375! That’s a 40% markup.
I don’t have a problem with Newegg making a profit on the sale, but a 40% markup is insane. Some reports around the Web speculate that Newegg is setting the price dynamically based on supply; there’s a lot of people interested in the Q6600 this week, so they’re charging a premium. But there doesn’t appear to be a shortage of Q6600s based on availability at other outlets.
The alternate explanation, of course, is that Newegg knows that the Q6600 is going to be popular this week, and is just looking to gouge people who buy from them reflexively. Lesson learned, then. In the past I’ve been happy enough with Newegg’s prices and service to just buy from them without looking too closely; but from now on I’ll check prices on any gear I buy from Newegg before I plunk down my credit card.
July 24, 2007
Jason, what you call gouging, is in reality supply-and-demand price. If NewEgg had a monopoly or special government-granted priviledges for selling CPUs, then they could say that they gouge consumers. With prices so high, all you have to do is wait a few weeks or buy from another supplier.
July 24, 2007
I never said Newegg didn’t have the right to charge a ridiculous price. Of course they do. They also have the right to be punished in the marketplace for overcharging.
I’m just trying to warn others that it is, indeed, a ridiculous price, and that they should take their business elsewhere.
Like, say, Mwave.com, where they have the same part in stock and ready to ship for $279 — nearly $100 less than Newegg:
This is why the “supply and demand” thing doesn’t apply here – there’s no shortage of these parts to justify the insane premium.