Sorry but GTX285 was at $399 not $300 when HD5870 was launched. HD5870 at launch time was faster and cheaper than GTX285.
Why do people in the age of the internet try to say things from memory instead of consulting available information.
http://www.anandtech.com/show/2841/27
Conclusion
The easiest kind of product for us to write about is the kind that’s clearly superior to its competition. The hardest kind to write about is the kind that’s stuck in the middle. For the 5870, we have the latter case.
Let’s be clear here: the 5870 is the single fastest single-GPU card we have tested, by a wide margin. Looking at its performance in today’s games, as a $379 card it makes the GTX 285 at its current prices ($300+) completely irrelevant. The price difference isn’t enough to make up for the performance difference, and NVIDIA also has to contend with the 5850, which should perform near the GTX 285 but at a price of $259. As is often the case with a new generation of cards, we’re going to see a shakeup here in the market as NVIDIA in particular needs to adjust to these new cards.
http://www.anandtech.com/show/2848/14
Conclusion
One thing that’s very clear in these benchmarks is that as things currently stand, the 5850 has made the GTX 285 irrelevant (again). The 5850 is anywhere between 9% and 16% faster depending on the resolution, cheaper by at least $35 as of Tuesday morning (with everything besides a single BFG model going for +$70 or more), and features DirectX11. The 5850 is a card that manages to – if at times barely – outclass the GTX285 in performance. If you’ve been waiting for a price shakeup, this is what you’ve been waiting for.
5850 launch price $259. $259+$30= $289 $259+$70=$329
So, no, the 5870 wasn't cheaper than the GTX285.
The justification for the 7970 price is twofold:
a) Not enough supply for demand;
b) No competitor price pressure. If people are buying the GTX580 for between $440-$550+, why won't they buy the 7970 that is 20%+ (and seems to have great OCing headroom, or is OC headroom only important if we talking about CPUs?) faster than the GTX580 for similar price?
The price premium is much higher between the GTX580 and the GTX570/6970 and the performance difference is actually smaller, than the premium between the 7970 and the GTX580 or the premium between the 7970 and the GTX570/6970.
See, AMD keeps redefining the price/performance, but now it is redefining the high-end segment, instead of the mid-range/low high-end segment.
On the other hand look how good is the GTX480 doing on the price performance segment these days.