not the good guys, just the lesser evil. people are just tired of what nvidia is doing.
AMD admits to restraining chip supply to keep higher CPU and GPU prices
- Thread starter Cal Jeffrey
- Start date
For those nVidia shills moaning here, for some reason, AMD cards are under Their own MSRP, while nVidia's are above Their own MSRP, so imagine what Jensen is doing to Your wallet.
AMD, Intel, and Nvidia all make their products in pretty much the same way -- dies are manufactured in bulk in foundries, before being sent on to a packaging plant, and then finally moved to storage and distribution centers.
In the case of AMD and Nvidia, they need to place orders with TSMC months in advance (or at the very least, 4 or 5 weeks) and it takes around a month to go from a silicon ingot to a finished die. So rapidly slowing down or ramping up chip production isn't something that can be done very quickly (Intel can do this quicker, as they have their own foundries).
Judging exactly how many chips to produce is a complex matter and it's generally best to under-produce, rather than over-produce, to ensure that there isn't an excess of inventory just lying around. The market has shown over the years that it's willing to 'accept' a shortage of products, especially graphics cards -- every time AMD or Nvidia has released a new lineup, the popular models are always in short supply.
Contracts with retailers, OEM suppliers, and AIB vendors will contain estimated projections for how many trays of chips will be available in a given period and such figures are likely to be on the conservative side of things, as well as have caveats along the lines of 'market conditions will affect this rate of shipping.' So under-shipped in this context means that AMD, Intel, and Nvidia will have not met this rate.
Prices are rising due to inflation and not anything special that AMD and nVidia are doing.
I look forward to seeing many people with healthy economic perspectives liking my post.
I look forward to seeing many people with healthy economic perspectives liking my post.
TheRealSCDC
Posts: 532 +920
Yes, the fact remains that neither AMD nor nVidia have made any effort whatsoever to improve the market for the average gamer. Sales are slow because of the cost. The economics are so simple and right in front of their faces.
Were you reading a different article?
TheRealSCDC
Posts: 532 +920
At a rate of almost 50-100%? Not according to the government which reports inflation tame at 8%. My income sits right in the middle class of America, and I can tell you, we aren't spending anymore, except for necessity. We are in save mode because we do not like the signs of things to come in the near future.
My father always told me while growing up, "Pay yourself first". And that's exactly what we do. Put large % of income away. Having no debt in my 50's except for a very small house payment helps me sleep very well at night.
Theinsanegamer
Posts: 4,153 +7,457
geforce 3060 is 276mm2 gpu with a 12gb 192 bit bus that MSRPs for $329
geforce 4070ti is a 295mm2 GPU with a 12gb 192 bit memory bus that MSRPs for $899, er I mean $799 since we were caught trying to sell it as a 4080.
Sure, that's just inflation, not rampant greed.
While I completely agree that Nvidia's pricing strategy is highly excessive and they're doing it simply because they can, comparing a card that uses a GPU made on Samsung's old, cheap, and low-density 8N process with 6 modules of 15 Gbps GDDR6 with one that uses TSMC's 4N node, paired with 6 modules of 21 Gbps GDDR6X, isn't exactly fair.
The production costs aren't going to be particularly close. The AD104 has a transistor density that's 179% higher than the GA106 (121.4 vs 43.5 Mtrans per mm2) and the 4070 Ti uses 'full die' binned chips; the GA106 in the 3060 has two SMs disabled, so it's in the mid-upper range of the bins. AMD has pointed out that TSMC's node costs have increased quite a bit, just across two generations.
The 4070 Ti's VRAM is only made by Micron, whereas Samsung, Micron, and SK Hynix all make 15 Gbps GDDR6 -- thus the price of the latter is going to be far more competitive than the former. There isn't much parity between the PCB components either: the old card typically has 5 VRMs for the GPU, whereas the new one comes with around 9.
AMD won't lower prices anymore because doing so, Nvidia would, too, thus people expect amd at decent lower price and then buy Nvidia products anyway.
Isn't it obvious? AMD move supply of chips to Epic as it's better margins.
Nvidia rarely competes on price. They did that with Ampere as they were caught by surprise with RDNA2's performance. But due to shortages and red hot demand from scalpers and miners, they got away from honoring MSRP. In fact they got away with 2x or more over the MSRP.
Sadly the majority of people commenting on this do not understand this or how a business works.
I don't agree their are clearly people in this thread that understand how a business works and the rest are just commenting out of emotion.
And the only one selling GPU's for 2k is Nvidia.
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Todd Sauve
Posts: 85 +103
Market manipulation and extortion. Thanks for joining Intel and Nvidia in the corporate criminal class AMD. 🤨😠
Avro Arrow
Posts: 3,714 +4,802
I think that Lisa Su said CPUs and GPUs but meant only GPUs.
It's hard to say that CPU prices have been kept inflated when the Ryzen 7000-series CPU prices have done nothing but plummet since their introduction. Even if AMD has been undershipping, it clearly hasn't had the desired effect on Zen4 prices.
What AMD is doing which is REALLY stupid however, is undershipping the RX 7900 XTX. When your card sells out like mad at the price that you want, YOU GET THOSE CARDS OUT THERE before people say "screw it" and buy a GeForce card. Undershipping to keep prices up is a dirty tactic that has been applied by corporations since time immemorial but to undership something that would immediately sell is just plain stupid.
I swear, AMD has to do some housecleaning when it comes to some of their senior managers. I think that they'd be better suited to working at a Canadian Tire store than being in charge of marketing and logistics for a tech giant like AMD. The horrible introduction of RDNA3 coupled with the XTX's lack of supply has cost AMD tens of millions of dollars in lost revenue.
If I were in charge there, those responsible for both the RDNA3 release fiasco and the decision to make more RX 7900 XTs than XTXs would be out on the curb before the next trash pick-up.
It's hard to say that CPU prices have been kept inflated when the Ryzen 7000-series CPU prices have done nothing but plummet since their introduction. Even if AMD has been undershipping, it clearly hasn't had the desired effect on Zen4 prices.
What AMD is doing which is REALLY stupid however, is undershipping the RX 7900 XTX. When your card sells out like mad at the price that you want, YOU GET THOSE CARDS OUT THERE before people say "screw it" and buy a GeForce card. Undershipping to keep prices up is a dirty tactic that has been applied by corporations since time immemorial but to undership something that would immediately sell is just plain stupid.
I swear, AMD has to do some housecleaning when it comes to some of their senior managers. I think that they'd be better suited to working at a Canadian Tire store than being in charge of marketing and logistics for a tech giant like AMD. The horrible introduction of RDNA3 coupled with the XTX's lack of supply has cost AMD tens of millions of dollars in lost revenue.
If I were in charge there, those responsible for both the RDNA3 release fiasco and the decision to make more RX 7900 XTs than XTXs would be out on the curb before the next trash pick-up.
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Endymio
Posts: 2,009 +2,117
You don't get to redefine terms simply because you're upset. When Jensen and Su show up at your house with a vanload of henchman, break down the door, and hold your new kitten hostage, you can claim extortion. Not until then.
Now some facts. Nvidia's current net margin is about 21%. Meaning that, even if they surrendered all their profit entirely, the price of their cards would drop only about 10%. That $1100 card would decrease to about one grand. Happy?
These GPUs are expensive because the chips are massive and produced on an astronomically expensive node. Their price will drop dramatically only when TSMC either improves yields, or decides it's amortized the construction cost of the associated fab. Until then, not even an Amazon-sized river of tears will change the situation.
Lower than that, actually - in its last quarter, the net margin was 11%. But that's across all its divisions and although FY2023 has just finished for Nvidia, it'll be a few more weeks before the annual report is released with income values for each sector.
Jerry in WA
Posts: 101 +125
People that used to buy reasonable, $200-$400 video cards (RX580/ GTX1070, etc) have been left behind for "high rollers" and people willing to eat Top Ramen for the entire year to pay for it. It's like buying tickets through TicketMaster and being pre-scalped.
Jerry in WA
Posts: 101 +125
6 year average inflation rate: 26% (about 1/4 more)
6 year nvidia GPU inflation rate: 103% (more than double)
This isn't all about "inflation". It's mostly about simple greed.
6 year nvidia GPU inflation rate: 103% (more than double)
This isn't all about "inflation". It's mostly about simple greed.
This article is silly. Any normal company balances it's supply to the market demand and tries to maximise profits at all time. Any company that doesn't, goes bankrupt very quickly. Claiming that they just do it to prop up prices is ignoring the simultaneous effect of dropping demand when prices rise. Any price of any product at any time is the result of this calculation. The price that gives the company maximum profit is not neccesarily the highest price if demand falls too much due to the high price. The use of the word "admit" is just creating a narrative as if it's something secret they don't want anyone to know. AMD didn't "admit" to anything, they just explained their business decisions to investors.
"If you haven't noticed, the tech industry is suffering a significant contraction. Executives are panicking as they try to pinch pennies with layoffs and other measures to keep investors happy. One of those "other measures" is restraining product supply."
They are not just "trying to keep investors happy", they are trying to keep their business running and not going bankrupt. Nobody would benefit from them going bankrupt, least of all gamers.
You've just "admitted" that the tech industry is suffering a significant contraction. How else would you propose tech companies respond to a significant contraction of their industry but with cutting costs?
"If you haven't noticed, the tech industry is suffering a significant contraction. Executives are panicking as they try to pinch pennies with layoffs and other measures to keep investors happy. One of those "other measures" is restraining product supply."
They are not just "trying to keep investors happy", they are trying to keep their business running and not going bankrupt. Nobody would benefit from them going bankrupt, least of all gamers.
You've just "admitted" that the tech industry is suffering a significant contraction. How else would you propose tech companies respond to a significant contraction of their industry but with cutting costs?
Endymio
Posts: 2,009 +2,117
You can still buy those exact same cards, and happy surprise! They're even less today. The new ones today, though, are a different beast entirely.
Cost of 14nm fab: $5B
Cost of 7nm fab: $15B (three times as much)
Transistors in Geforce 1080: 7.2 billion
Transistors in Geforce 4090: 76 billion (more than 10 times as much)
Right; I was using last year's data. When they release 2022, it'll be worse, and '23 almost certainly lower still.
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Bamda
Posts: 459 +262
I own an Nvidia 1080 Ti. I have wanted to upgrade for a while. I skipped the Vega/2000/5000 cards as I wasn't impressed and still had plenty in the tank. As we all know the 3000/RDNA 2 pricing went sidewise fast and I was never going to pay that much for my card. I saw the new cards being released and thought maybe now is the time, but the prices have kept me away. The same sort of thing is still going on in a different way with regard to prices. Nvidia and AMD have shown they are companies first and could care less about consumers. This article reminds me that I need to be a consumer first and a computer enthusiast/gamer second.
yRaz
Posts: 5,322 +7,207
but you don't have to shell out 2 grand for a GPU, go buy a 6700XT or a 3060. Both are fantastic products that game at 1440p and even push 4k in some titles. They have offerings at every price point and last gen is selling at lower than MSRP right now give you better price to performance. Go buy a 3090 for $800, that's $1200 cheaper than it retailed for literally less than a year ago. Yes, new 3090's can be found for $800
And ignore amazon pricing, their algorithm automatically adjusts prices for the amount of product in stock in their fulfillment centers. If they only have a few in stock then the price shoots up.
Customers no longer exist, the shareholders are their customers. We are 'consumers'
Never forget that. This fact alone is what makes fanboying so annoying.
And just a note, AMD 6000 cards have some fantastic deals on them, 6700xt would beat your 1080ti and get your foot in the door to ray tracing.
Sorry to say but you are exactly the paradigm to avoid ,amd less nvidia more but in the same strategy, they have you believe that buying a 3080 at 800 is a good deal just because it was priced at 1200 or more ,the big trap is that you actually paying a price that should of been the start point at launch and now should of been like 500 ,what's the strategy-launch at higher prices now and get customers that don't have money issues, after they get customers like you saying that is a bargain getting a 3080 at 800 (after 2 years) ,so they have a big profit even after 3 years and you are getting a GPU 3 years old like it was launched yesterday!! In the meantime they have launched the new generation at even higher prices so they can repeat the same thing over and over ,the end game is that they get more money from you and you still feel happy because you think that you got a GPU cheaper then the first s.u.c.kers ....LOL
yRaz
Posts: 5,322 +7,207
This is the economy we are in, either learn to navigate it or don't participate in it. I know they gave their playing. It's why I have a 6700xt instead of a 7900xtx. It sucks, everything about this situation sucks, but make a budget and stick to it. Frankly, I more than halved my GPU budget and bought a 6700xt because I don't want to play their games.
We can't avoid them completely but we can be smart about playing their game because they literally hold all the pieces in this game they're making us play.
I could afford a 4090 but I think it's a stupid product at its current price, obviously other people disagree with me.
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