My feelings on this issue are pretty strong. I feel that the manufacturers are simply following demand. The average 'enthusiast' has become completely irrational.
I can think of no better example of this than the DRAM market. There is a recent article on a certain review site we are all famiar with which shows in every minute detail how different memory modules perform. We look at the results and see wow module X performs better than module Y by 3% in 3d game Q.
People then extrapolate that they will see 3% improvement in most 3dgames. My own experience is that this does not translate well at all to games I play at the resolutions I play at. In my case and benchmarking of Battlefield: Vietnam there was virtaully NO playability difference to me running my memory at 200MHz FSB and 150 MHz FSB. In my case dropping from 200 FSB to 150 FSB at the same processor speed resulted in a 1.4% change in average FPS. At the resolution I play once I filtered out all frames above 80FPS (because I don't care about time periods above 80 FPS, I don't experience slowdowns there, I only care about areas where I can perceive a difference
Look at newegg prices today (6/16) at high end PC3200 or PC3500 and you'll see as high as $350 or more for 2x512MB DIMMs. At the same time you can get Kingmax 2.5-3-3 PC3500 512MB DIMMS for $88 each, for about $170 for a gig, or half the price of a set of very high end PC3500. I think a disproportionate number of people end up buying the Corsair/OCZ/Mushkin high end memory vs. the rather boring and generic Kingmax RAM.
We all see the benchmarks and our nature tempts us. Few have the analytical tools or training necessary to truly tell us what is best for us, and most simply go by the reviews. This means the high end memory business gets a LOT more business than they otherwise would. The internet and review sites fuel the demand, and the manufacturers build to that demand.
The same could be said for CPUs. CPUs are only a factor in some games. Again, in my BFV testing, I cranked my AthlonXP all the way down to 1200 MHz before I saw any FPS reduction at all on periods below 80 FPS. Even at 1000 MHz, I saw no change to the areas where I noticed slowdowns when playing. So I spent a bunch of money upgrading from an XP1500+ to an XP2500+@2200, new motherboard, new memory, $400 or so to get what? a 4% performance difference at the resolution I play at. Read that again and realize that I am serious when I say I noticed NO DIFFERENCE when playing Battlefield: Vietnam at 1000 MHz or 2200MHz at 1024x768 with a GF FX 5900XT. I even played at 1000 MHz for a few days just to make sure I wasn't imagining things. Nope, I wasn't. 1000MHz made no perceptible difference at all to me.
Overclocking CPUs used to be about VALUE. I bought a PPro 166 and overclocked it to 200 MHz because it made Quake (software rendering...eeech) much more playable. Not only that but regular apps were more dependent on CPU speeds.
But now people will buy a 2.4 P4 and overclock it into the 3.2 and 3.4 range saving $100-200 on the processor. But to make that overclock they had to buy memory that was $150 more expensive than the memory that would work just fine with the P4 3.2. Not to mention the only FPS benefit its getting them is already over the threshold of what their monitor is able to display (75-100Hz range for most). Huh? I don't get it. Completely irrational.
Video cards are, I believe, the ONE exception in the computer world. Video cards are definitely the first order effect. A better video card will, in most cases, translate DIRECTLY to better performance and a better personal experience. It is the only market where if I spend a considerable amount of money, I can see a tangible benefit. You don't spend $400 instead of $100 on a CPU and then get to bump your res up a notch. But a $400 on a graphics card vs. $100 on a graphics card is a night and day difference. I don't see a problem at all with prices of video cards escalating. Demand is increasing for a good reason here. Supply of FAST GDDR is limited, GPUs are IMMENSELY more complex than previous generations, so you can't expect rock bottom prices.
I'm JUST starting to see the signs of people waking up to what has happened to computer enthusiasts with things like the HardOCP changes to the way they review video cards. No bar graphs at different resolutions, just pure information on what settings people like them, gamers, would actually run at.
There will always be the true hardcore. Those that define the hobby. Those that waste money, know it, and don't care. But I think more and more people are sucked into being hardcore/wasting money when they really aren't hardcore and don't want to waste money... especially when it comes to RAM and CPUs. I see it every day. Not so much on these forms, but definitely on game specific forums where people are giving hardware advice.
The article linked by the OP blames the manufacturers for leaning out the midrange, but I think they are only following the market demand. WE are leaning out the midrange. WE are demanding more and more extreme products. The manufacturers are simply giving us what we want.