RussianSensation
Elite Member
- Sep 5, 2003
- 19,458
- 765
- 126
Agreed. People hating the $650 price need to ask themselves: what's the alternative? Price it lower and continue the epic fail bang-for-back strategy? What will that achieve? How will that help AMD?
We don't even need to go so far back to $199 HD4850/$299 HD4870 days but looking at recent times when AMD had $399 R9 290 against $499 780 or $549 290X vs. $699 780Ti or $299 R9 280X vs. $379 770 2GB/$449 770 4GB, that hardly produced massive wins in market share OR profits. The price/performance strategy barely worked with the 5850/5870 despite AMD essentially having the $250+ market all to itself for 6-9 months before GTX460/470/480 dropped. Since AMD cannot expect to beat AMD to market by 6+ months every generation, this strategy is not sustainable.
It's better for AMD to sell out a low-volume part for $650 rather than $400. As Apple has shown in the smartphone market, marketshare is virtually irrelevant. All that matters is profit.
I agree with you.
"Report: Apple takes 92% of smartphone market profits on just 20% of sales"
If AMD makes profits with 18-20% market share, it's actually a more sustainable going concern than having 40-50% market share with quarterly losses. We'll have to wait for Q3-Q4 2015 results though to see what's happening in their GPU division. I think the shortage of supply for Fiji cards is going to hold them back.
Surprisingly, even at $650-670, XFX Nano or Gigabyte Nano are currently OOS on Newegg.
The price of the Fury X on Newegg has actually risen from $649 MSRP to $680 and $700. Both cards OOS.
Amazon has PowerColor Fury X for $900, XFX Fury X for $1000, Sapphire Fury X for $1531. Are those prices crazy? Absolutely but if there are enough people paying them, then I guess AMD's CEO has made the calculated bet that it's better to maximize profits on early adopters (not surprisingly a similarly NV uses with its Titan series).
Again, that might not be good for customers, but Apple/nVidia/Intel have historically engaged in many anti-customer practices. But these companies are profitable while AMD is not. Customers still open their wallets so they tacitly accept being treated this way, despite complaining on the forums.
True. Also, certain brands have so few sales until the existing generation is discontinued/becomes very old in relative terms of its product cycle (Louis Vuitton, Hermes, Apple, NV), that because the consumers know that dramatic price drops are unlikely to occur in the short term, they are conditioned to not wait for months at a time for some future sale, because what's the point?
Perhaps, as a long-term strategy, the new CEO is trying to establish some brand equity and send a similar message that AMD is not a budget brand? Without a doubt some consumers do correlate price with quality whether it's warranted or not. That means for some consumers the fact that AMD constantly prices their cars for less is automatically correlated that AMD's products are never on the same level as NV's. Should AMD miraculously manufacture a superior flagship in the future, this perception won't just go away either.
Also, some gamers might not bite on the Fiji cards this generation, but let's say in 2016-2018 when it's time to upgrade, they'll recall that AMD didn't bother going after price/performance or didn't bother dropping prices quickly post-launch as they often have done in the past. As a result, should they find some other next gen AMD GPU appealing at launch, they won't bother waiting for months for the typical/expected price drops that AMD's cards have had in the past. I am just speculating but there are larger implications for the product/brand that result from keeping prices high and maintaining them longer. The new CEO can try new strategies, look at the data over 3-4 quarters and see what works and was hasn't worked. I think it's a lot better than doing the same thing over and over that hasn't worked for 5 generations as you and I both agreed.
Another implication is that if start with a low price, you don't have a lot of room to cut prices in case your competitor releases newer products. In this example, should NV beat AMD to market with Pascal, as a last resort, AMD could drop prices on Fiji products to lower levels to give them some time to respond with 16nm HBM2 GPUs. Had AMD started off with $399-499 pricing on Fiji cards, then they would have had no room to respond really. Since undercutting NV right off the bat wasn't really successful in converting market share/loyal NV customers, it seems futile especially after seeing $200 GTX960 outselling after-market R9 290s or $550 GTX980 absolutely clobbering R9 $300-350 290X. There is no way Lisa Su isn't paying attention to these trends so she probably consciously gave up on trying to convert the most loyal customers of NV and focused purely on profits.
---
It seems PC gamers keep voting with their wallet that they aren't concerned with how NV achieves the performance optimizations in games, all they care about is the end user experience. If that's the case, AMD must do the same or it's literally giving away all of its competitive advantages. I would really hate to see the PC industry turn to this, but in line with NV's GW's strategy that PC gamers seem to be embracing/have no problem with on the whole, the next step is for AMD to work directly with major developers to optimize DX12 code-path for its Asynchronous Compute Engines and lock out the source code from being optimized for NV cards wrt to features like TressFX 3.0. Since the free market failed to be efficient and didn't boycott GW's titles, which is clearly a conflict of interest of PC hardware developer directly influencing software development in exchange for co-marketing (i.e., monetary benefits), it's survival mode now for AMD. They can't continue being Mr. Nice guy.
Last edited: