Nvidia Quadro prices cut in half. Why? Lets find out

[Madcatatlas]

It would seem, as reported by some sites and echoed troughout discussion forums on the net, that Nvidia is lowering the price on its professional series Quadro graphic cards by 50%. These cards cost an arm and a leg, but provide what professionals need if we are to belive Nvidias marketshare in the professional market.

Now as to the why.

What exactly is being done? what product is the price being cut on?
Is it only the Quadro 6000 cards which sell for around 5000$?

Is the price just too high?
Ofcourse lowering the price will sell more if that is the only issue.

As i said in the topic that led me to start this one: Wouldnt you feel stupid if you just spent 5000$ for one of these only to find the price lowered to half of that the next week?
I would assume that the customer in such cases would be reimbursed with the money overshooting 2500$, but im not sure that is the case here with Nvidia.

Is there not enough demand?
unlike the G200 graphics parts, the Fermi parts dont have very good reputation on the heat, noise and powerdraw barometer. Do these things matter in the professional space?

Who are the quadro/firepro customers anyway? Anyone care to shed a light on this?

What could substitute such a product if not another Quadro? Firepro maybe?

Is AMD launching an improved Firepro card at lower cost?
Its not long since AMD released the FirePro V8800 professional graphics card., are they set to release the 6xxx series derivate professional product this soon?

Are there new features in on the HD69xx series that make it even better for professional graphics use?

 

[BD231]

lol @ gpgpu, the whole concept is what's failing yet you'd be hard pressed to convince nVidia fan boys it isn't the next greatest thing to hit the planet.

 

[Arkadrel]

As I understand it from what Ive heard on forums, nvidia is loseing money selling some of their discreat cards because of how much bigger in die size they are compaired to Amd/ati's.

Most of their money comes from their proffesional line.... cutting prices by 50% is going to have a big effect on their overall profits. There has to be a reason their doing it, and I dont think its because "Customers found out the normal Fermis do a good enough job at much lower cost".

Nvidia hardware crippled the 4xx series, so you cant really use them for the proffessional stuff anymore. Your forced to buy their quadro line if your serious about that stuff.

that leaves:

1) Price is/was too high
2) Demand is/was not high
3) Nvidia lowered prices in anticipation of AMD releasing a new product

1) if you can sell something high, why not? more profits, which means they cant right now, only reason to lower the prices. Why not is the real question, why cant they sell them at normal prices anymore?

thats either 2) or 3)

 

[Cookie Monster]

Ive read some reviews on the new Quadro parts from nVIDIA quite sometime ago, and they absolutely hammer any competition. So when it comes to performance, they are quite good but compared to its AMD counterparts they cost alot more.

Companies wont mind to pay such a high price given the track record with the performance and support for Quadro cardss.

Some of the theories from the above post could be true, but on the other side of the coin it could mean that nVIDIA wants to really kick AMD out of the professional market all together. They've got the performance/drivers so by reducing the price as much as 50%, that could be severely erode AMDs ~11%? (correct me if I am wrong) market share. This kind of promotion could be to lure in AMD customers.

As for power and heat/noise, its quite good on the quadro cards which is quite ironic given the reputation of Fermi based video cards. Unlike 3D apps, they dont nearly as much stress the entire GPU.

Also AMD doesn't need to release any more firepro cards because the hardware isnt the issue. What they need to do is bring out better software support for optimizations like nVIDIA. nVIDIA has done such a better job in the software side of things.

 

[Arkadrel]

@cookie monster

thats actually a good point, a 4th option.

5) nVidia cut prices to keep amd out of the proffessional market.

But doing so again most be for a reason, so it only makes sense if you pair that with
"Nvidia lowered prices in anticipation of AMD releasing a new product".

its not like nvidia needs more market share in the proffesional markets, when they already have so much compaired to AMD, the gigantic amount of money lost for a tiny gain in marketshare that amd have doesnt make sense.

they must be doing it because of the new proffesional cards amd are comeing out with then.

 

[WelshBloke]

How about "the economys still not great and companies need some encouragement to spend at the moment"

 

[Arkadrel]

If car sales are picking up alot recently, which cost alot more and usually have less of a effect than haveing a faster grafics card would (for a company). I dont see why it should be the economy.

If your in the biz and need a fast card, for new rendering, I dont think price is that big a issue, you make your liveing off of the grafics, you need the best tools at your disposal. Atleast alot more than you need a new car.

maybe your right though.

 

[Lonbjerg]

You lack the option of:
Clearing out stock due to upcomming new hardware *shrugs*

 

[WelshBloke]

You lack the option of:
Clearing out stock due to upcomming new hardware *shrugs*

When did the 6000's come out? Wouldnt have thought companies upgade that quickly.

 

[Cogman]

@cookie monster

thats actually a good point, a 4th option.

5) nVidia cut prices to keep amd out of the proffessional market.

But doing so again most be for a reason, so it only makes sense if you pair that with
"Nvidia lowered prices in anticipation of AMD releasing a new product".

its not like nvidia needs more market share in the proffesional markets, when they already have so much compaired to AMD, the gigantic amount of money lost for a tiny gain in marketshare that amd have doesnt make sense.

they must be doing it because of the new proffesional cards amd are comeing out with then.

You know, the same thing could have been said about AMD and Intel in the late 90's. Intel had a huge standing in pretty much every faction of the CPU industry whereas AMD was barely visible. However from about the XP -> X2 line of processors (until the release of the core2) amd made a KILLING. They increased their almost non-existent server market share to something like 30%. Those kinds of market losses don't got unnoticed by companies.

Is it really unreasonable to think that nVidia might think "Hey, AMD is targeting the professional market, we better preemptively lower prices to keep them out". The possibility of losing money in one of their major cash cows is something they generally try to avoid at all costs.

 

[Idontcare]

It would seem, as reported by some sites and echoed troughout discussion forums on the net, that Nvidia is lowering the price on its professional series Quadro graphic cards by 50%. These cards cost an arm and a leg, but provide what professionals need if we are to belive Nvidias marketshare in the professional market.

Now as to the why.

What exactly is being done? what product is the price being cut on?
Is it only the Quadro 6000 cards which sell for around 5000$?

Is the price just too high?
Ofcourse lowering the price will sell more if that is the only issue.

As i said in the topic that led me to start this one: Wouldnt you feel stupid if you just spent 5000$ for one of these only to find the price lowered to half of that the next week?
I would assume that the customer in such cases would be reimbursed with the money overshooting 2500$, but im not sure that is the case here with Nvidia.

Is there not enough demand?
unlike the G200 graphics parts, the Fermi parts dont have very good reputation on the heat, noise and powerdraw barometer. Do these things matter in the professional space?

Who are the quadro/firepro customers anyway? Anyone care to shed a light on this?

What could substitute such a product if not another Quadro? Firepro maybe?

Is AMD launching an improved Firepro card at lower cost?
Its not long since AMD released the FirePro V8800 professional graphics card., are they set to release the 6xxx series derivate professional product this soon?

Are there new features in on the HD69xx series that make it even better for professional graphics use?

When you have a query sometimes it is easiest to just look to a market for analogues which already have a known market model rationale.

For example, why did Intel reduce the price on their already flagship-leading 965X just to release yet another flagship-leading 980X for $1k in its place?

Did they reimburse the 965X owners the price-difference after they reduced prices on the 965X?

Did the 980X release and price-cut on the 965X have anything to do with the products of their competitor?

If you told me that Nvidia cut the price on their flagship product without releasing replacement SKU I would assume they are clearing inventory to make room for an even higher performing SKU that will be forthcoming from them.

 

[Grooveriding]

In the past has nvidia ever dropped the price of their quadro cards so drastically and then followed it up with a new quadro card ?

 

[n0x1ous]

do we know if it's permanent or just a promotion?

 

[Douglar]

I vote 'inventory surplus' complicated by 'cash flow problems'. While Nvida might have had a lot of "cash" on their balance sheet last Q, it wasn't all liquid, and in the mean time, legal settlements & product development have been eating up the stuff that was.

Nvidia has too much product on the shelf in retail right now and they booked the revenue for that product when it was sold to AIB makers a while back. In order to get the retail market cleared so that AIB makers order more chips, it will take a lot of rebates, so that will also be a short term cash drain.

If orders for new retail chips won't bring in the expected money this quarter, the next best option is to try and make a revenue spike in the pro market. The fact that each chip sold in the pro market is one less retail rebate doesn't hurt either.

 

[mosox]

Maybe it has something to do with this:

http://www.geek.com/articles/news/m...ing-much-to-nvidia-and-amds-chagrin-20101013/

 

[Arkadrel]

Moscox isnt that just for encodeing? like with movies and such... so MS has a patent they can hold over nvidia/amds heads so what.

Cant nvidia/amd just remove the movie encodeing software support? or pay MS a patent licensing fee?

Meh... I dont think that has anything to do with Nv cutting prices though.

 

[maddie]

We know this.

AMD has overtaken Nvidia in consumer/gamer market share especially the larger profit mid/high end, except for the late released 460GTX, which has now been bettered.

The world Western economies are laboring and consumers AND companies are spending less. There is no slow recovery, it's reversing to pre-stimulus levels. http://globaleconomicanalysis.blogspot.com/2010/10/industrial-production-unexpectedly.html

The upcoming release of fusion chips will remove Nvidia from the lower end of the graphics market especially with oem customers.


Interpretation:

Nvidia needs a certain level of sales/ revenue to pay operating expenses. This has fallen a lot lately.

A company can survive a long time without profits, but lack of cashflow/revenue kills quickly. I have stated this before here but been criticized intensely. All of Nvidia's much praised cash hoard can evaporate fast if they have to maintain staffing levels and investment.

In my view, they will sacrifice profits to maintain revenue and hope Kepler can win from Radeon 7xxx. It's a tight race for survival.

I've stated it before. In my opinion Nvidia is in serious trouble


No way you give up 40% of price to gather 11% market share. You lose overall.

 

[Grooveriding]

We know this.

AMD has overtaken Nvidia in consumer/gamer market share especially the larger profit mid/high end, except for the late released 460GTX, which has now been bettered.

The world Western economies are laboring and consumers AND companies are spending less. There is no slow recovery, it's reversing to pre-stimulus levels. http://globaleconomicanalysis.blogspot.com/2010/10/industrial-production-unexpectedly.html

The upcoming release of fusion chips will remove Nvidia from the lower end of the graphics market especially with oem customers.


Interpretation:

Nvidia needs a certain level of sales/ revenue to pay operating expenses. This has fallen a lot lately.

A company can survive a long time without profits, but lack of cashflow/revenue kills quickly. I have stated this before here but been criticized intensely. All of Nvidia's much praised cash hoard can evaporate fast if they have to maintain staffing levels and investment.

In my view, they will sacrifice profits to maintain revenue and hope Kepler can win from Radeon 7xxx. It's a tight race for survival.

I've stated it before. In my opinion Nvidia is in serious trouble


No way you give up 40% of price to gather 11% market share. You lose overall.

One does wonder with them now selling the monster gf100 core and expensive PCB of the GTX 470 for $250. Consider that the GTX 480 still sells for $450 and is using the same core, albeit with a different cooler, PCB and a bit more VRAM.

Again we can't speak in absolutes, but there is a very good chance GTX 470s are selling at a loss now. The 470 launched at $350 and is selling for $100 less now. That is a huge price slash, if their margin was $100 to begin with that would be impressive enough, its hard to see them making anything on the card anymore at its new price.

 

[shangshang]

this part is a little dumb

Customers found out the normal Fermis do a good enough job at much lower cost

Professional who rely on professional tools for a living, you know not your gamer hack, would be idiotic to think like such. You know what's gonna happen when you go to meeting with the big boss and you didn't finish your project on time then said "oh boss I was trying to be a hack and thought I would save the company a few bucks by buying Fermi instead of Quadro"?? You're gonna look like a pink elephant as everyone focuses on your reasoning why you didn't get the project done on time and holding up everyone else.

and there should be an option: "this poll is a little meaningless"

 

[extra]

Or, option c)
--They are going to introduce a new high end quadro soon, and are cutting prices on the existing stuff to make room at the top for the forthcoming new high end part.

This stuff happens all the time in the tech world, not sure why it's news in this case ^_^.

 

[Arkadrel]

this part is a little dumb

Customers found out the normal Fermis do a good enough job at much lower cost

Professional who rely on professional tools for a living, you know not your gamer hack, would be idiotic to think like such. You know what's gonna happen when you go to meeting with the big boss and you didn't finish your project on time then said "oh boss I was trying to be a hack and thought I would save the company a few bucks by buying Fermi instead of Quadro"?? You're gonna look like a pink elephant as everyone focuses on your reasoning why you didn't get the project done on time and holding up everyone else.

and there should be an option: "this poll is a little meaningless"

I very much agree, silly to have that option there.
Plus theres the fact that nvidia hardware crippled the 4xx not to be able to do what the quadros do. The 4xx are MUCH slower than the 2xx cards in that respect so... yah no one in their right mind is useing normal 4xx cards for that stuff.

 

[Zap]

This is only on retail boxed PNY products and not the OEM products included with workstations. I imagine sales are a lot lower on the retail products. One company I worked for would only buy retail Quadro products as replacement parts for systems outside of warranty, otherwise all the Dell Precision tower systems get an OEM card.

FYI PNY is the sole vendor for retail boxed Quadro for perpetuity. However, OEM cards in pre-built systems are from Nvidia.

 

[Kenmitch]

This is only on retail boxed PNY products and not the OEM products included with workstations. I imagine sales are a lot lower on the retail products. One company I worked for would only buy retail Quadro products as replacement parts for systems outside of warranty, otherwise all the Dell Precision tower systems get an OEM card.

FYI PNY is the sole vendor for retail boxed Quadro for perpetuity. However, OEM cards in pre-built systems are from Nvidia.

So maybe PNY is pulling out of the Quadro market or they are just dumping the inventory off at close to cost before a new Quadro line is released. Could be PNY is having a bad year and needs the revenue to balance the books?

 

[Janooo]

Ive read some reviews on the new Quadro parts from nVIDIA quite sometime ago, and they absolutely hammer any competition. So when it comes to performance, they are quite good but compared to its AMD counterparts they cost alot more.

Companies wont mind to pay such a high price given the track record with the performance and support for Quadro cardss.

Some of the theories from the above post could be true, but on the other side of the coin it could mean that nVIDIA wants to really kick AMD out of the professional market all together. They've got the performance/drivers so by reducing the price as much as 50%, that could be severely erode AMDs ~11%? (correct me if I am wrong) market share. This kind of promotion could be to lure in AMD customers.

As for power and heat/noise, its quite good on the quadro cards which is quite ironic given the reputation of Fermi based video cards. Unlike 3D apps, they dont nearly as much stress the entire GPU.

Also AMD doesn't need to release any more firepro cards because the hardware isnt the issue. What they need to do is bring out better software support for optimizations like nVIDIA. nVIDIA has done such a better job in the software side of things.

If I was one of the 89% of customers and bought the card recently I would not be very happy.

 

[Genx87]

These markets arent as price sensitive as people think. We just wpent 21K on 4 developers who had to have Apple products to do their graphics workload. It could had been 42K and it wouldnt matter. Companies spend more on human capital and software licenses than they do the actual hardware. A graphics designer might run 70-100K\year + software licenses + training + the hardware. In that mix do you think 2500 is going to even going to register?