Speculation: Ryzen 3000 series

[PotatoWithEarsOnSide]

What's missing in this debate is that even if AMD were competing against its own gen 1+2 sales with gen3, that isn't actually a bad thing; their deal with GF is a bad one, so better to use their wafer allocation on a smaller IO die that yields much more than the larger year old gen, since they'll get the cost spread over at least 2 units compared to 1 for the last gen. Once the WSA expires, you bet your home on AMD cutting all ties with GF.
Cannibalising your own sales isn't a bad thing if you're selling the replacement product at a higher margin despite a lower price for the consumer.

 

[DarthKyrie]

Wafers for complex designs take months to go through the process, so if anything AMD is going to order more wafers than it estimates demand to be. It's worse off to underestimate than over estimate after all if production really is as cheap as you insist. Look at intel now struggling to meat 14nm demand.

So AMD may very well end up with wafers it has trouble selling. Thats probably also why there are still 1700s being sold for a third of msrp.



I don't remember a single instance where intel lowered prices much less to move unsold products.

AMD not having foundries does not exclude them from using the same strategy either.

AMD still has the 1700s because they are still making EPYC.

 

[JasonLD]

Though I think AMD will surely undercut Intel pricing with equal number of cores, I don't expect them to be as cheap as like 16-cores for $500. Making them too cheap will create a perception that they have less performance per core while compensating them for more cores.

 

[Kocicak]

Prices are dictate by market conditions, NOT what the consumers want.

Well, the DEMAND side of the market expresses what consumers want. And also, there are two prominent business strategies which impact pricing: profit maximisation and market share maximisation. And in both of these strategies the opinions (or preferences) of consumers are crucial.

 

[Arzachel]

Though I think AMD will surely undercut Intel pricing with equal number of cores, I don't expect them to be as cheap as like 16-cores for $500. Making them too cheap will create a perception that they have less performance per core while compensating them for more cores.

Yeah, I think we'll see a similar pricing structure to the 2XXX series for 8 cores and under, with the dual chiplet ryzen pricing overlapping low-end threadripper slightly. Mockingbird's pricing guesses feel pretty on point to me.

 

[Topweasel]

AMD, like any other company, responds to competition (which, in this case, is obviously Intel).

$499 12C/24T Ryzen 9 3800 already has 50% more cores/threads than Core i9-9900K. (assuming similar single-thread performance)

Unless Intel launches a proper competitor to the Ryzen 9 3800, AMD has no incentive to lower the price.

___________________________________________________________________________________________________________

Now, let's say that Intel actually launches a new $499 12C/24T processor.

That would give incentive for AMD to launch $499 16C/32T Ryzen 9 3900 to undercut Intel's pricing.

But AMD isn't just competing with Intel's performance they are competing with the ghost of Intel the superior. Their goal is to incentivise people away from buying a 9900k, they have to be prepared for Comet Lake. That doesn't mean going soft and throwing margin away. But if they are pricing their consumer chips out of thousands of purchases just because Intel doesn't have a great competitor for them they are doing themselves a disservice in their attempt to get market share. This can go back in forth for days. So let me ask you a question. Knowing what you know of AMD. Lets say you were offering these 12c and 16c AM4 chips, lets call them the 3800, 3800x (12c 65w and 110w CPU's) and a 3900 and 3900x (same) what would you price them at?

 

[DrMrLordX]

With big.little aSMT threads (16 strong + 16 nice) and somewhat modest base frequencies (not too far north of optimum perf/watt) the two memory channels wouldn't even be a typical limitation.

Intel is already exploring asynchronous core configurations, so it would be interesting if AMD could do the same. Sadly, I see no indication that they are currently planning such a thing.

Now on to the issue of AMD's pricing:

I tried to quote, um, somebody, but it didn't work when multiquote broke. So all I'll say is that AMD will probably follow historic pricing levels for their Zen products and leave it at that. $499 will be the price for their initial top-end chip at launch to mirror the 1800x. The bottom end will mirror the MSRP of the R3 1200, which was . . . $110? So that will be the price range for their entire lineup. Higher core-count/faster Zen2 models for AM4 may break that pricing structure.

 

[PeterScott]

What you (and other people on this forum) are doing wrong is that you are pricing things from the perspective of the consumer. (What I called "wishful thinking".)

e.g. The prices will be as such because, I, the consumer want them to be.

When you need to do (if you want realistic prices) is to price things from the perspective of the producer.

...and from the perspective of the producer, those prices make no sense.

Prices are dictate by market conditions, NOT what the consumers want.

Exactly.

Wishful thinking is why so many people believe outrageously Pollyanna rumors and "leaks", and then later are disappointed when reality isn't quite so Rose tinted.

Whenever I look at any rumor/"leak", the first thing I do is look for the wishful thinking trap, and walk in the shoes of the manufacturer, not the consumer dreaming of massive deals.

AMD has lower margins and significantly lower profit than Intel/NVidia, the absolute last thing AMD wants is to provoke a price cut from either of them. That would disproportionately harm AMD.

What you will see AMD doing is exactly what they have been doing, offering a marginal improvement in price/performance compared to it's bigger rivals, so they can attract some additional buyers without provoking price cuts from the competition that will destroy AMDs own margins/profits.

Initially, I expect that Ryzen 3000 will be priced are par with Ryzen 2000 on a per core basis, if not higher, due to superior per/core performance. They will undercut Intel, and offer superior price/performance on multicore loads to whatever Intel is selling.

Because that is what a well run manufacturer looking to maximize profit would do, and AMD under Lisa Su, is a well run manufacturer.

 

[Atari2600]

Initially, I expect that Ryzen 3000 will be priced are par with Ryzen 2000 on a per core basis, if not higher, due to superior per/core performance. They will undercut Intel, and offer superior price/performance on multicore loads to whatever Intel is selling.

Definitely priced higher than R2000 (per core)!

(i) Performance relative to the competition is higher and (ii) Manufacturing cost step relative to previous manufacturing cost step is higher (indeed, previous shrinks typically lowered manufacturing cost per chip - this may not be the case for 7nm).

Put those two together and surely it cannot be anything put higher price per core than R2000.

 

[Mockingbird]

You're guilty of thinking from the perspective of a market leader.

No. Those prices are already far cheaper than Intel's.

Both are happening in this thread...
For the high end sure AMD might not have as much incentive to lower prices, but I and a lot of others think that isn't true for the low end.

We can argue all day about what the exact prices will be but in the end I'm betting they'll be lower than current ones.

As I said before, AMD already dominates the ~$200 and under market.

AMD doesn't need to drop prices to compete with itself.

Intel dominates the $300+ market with processors such as the Core i7-8700K, Core i7-9700K and Core i9-9900K.

The $300+ market is where AMD can make inroads and gain marketshare.

That's where the processors such as the $329.99 8C/16T Ryzen 7 3700X (comparable to Core i9-9900K in performance) and the $499 12C/16T Ryzen 9 2800 come in.

What's missing in this debate is that even if AMD were competing against its own gen 1+2 sales with gen3, that isn't actually a bad thing; their deal with GF is a bad one, so better to use their wafer allocation on a smaller IO die that yields much more than the larger year old gen, since they'll get the cost spread over at least 2 units compared to 1 for the last gen. Once the WSA expires, you bet your home on AMD cutting all ties with GF.
Cannibalising your own sales isn't a bad thing if you're selling the replacement product at a higher margin despite a lower price for the consumer.

How do you know that the replacement product are going to have higher margin despite selling at half the price? (supposedly, the MSRP for 6C/12T went from $199 this generation to $99 the next generation, according to the so called "leak")

Well, the DEMAND side of the market expresses what consumers want. And also, there are two prominent business strategies which impact pricing: profit maximisation and market share maximisation. And in both of these strategies the opinions (or preferences) of consumers are crucial.

AMD can't take market share from itself (obviously), but AMD can take market share from Intel.

That means swaying consumers who intended to buy products such as the Core i7-8700K, Core i7-9700K, and Core i9-9900K.

Products such as the Ryzen 7 3700X and Ryzen 9 3800 provide compelling alternatives to those consumers.

$329 8C/16T Ryzen 7 3700X with similar performance to Core i9-9900K

$499 12C/24T Ryzen 9 3800 with 50% more cores/threads than Core i9-9900K

But AMD isn't just competing with Intel's performance they are competing with the ghost of Intel the superior. Their goal is to incentivise people away from buying a 9900k, they have to be prepared for Comet Lake. That doesn't mean going soft and throwing margin away. But if they are pricing their consumer chips out of thousands of purchases just because Intel doesn't have a great competitor for them they are doing themselves a disservice in their attempt to get market share. This can go back in forth for days. So let me ask you a question. Knowing what you know of AMD. Lets say you were offering these 12c and 16c AM4 chips, lets call them the 3800, 3800x (12c 65w and 110w CPU's) and a 3900 and 3900x (same) what would you price them at?

As I said before, that's exactly why AMD don't name and price its products until close to release: there's no knowing what the competition is going to be like until close to launch day.

The pricing above assumes Comet Lake's pricing is similar to Coffee Lake's pricing, which is, of cause, not a sure thing.

 

[Mopetar]

What you (and other people on this forum) are doing wrong is that you are pricing things from the perspective of the consumer. (What I called "wishful thinking".)

e.g. The prices will be as such because, I, the consumer want them to be.

When you need to do (if you want realistic prices) is to price things from the perspective of the producer.

...and from the perspective of the producer, those prices make no sense.

Prices are dictate by market conditions, NOT what the consumers want.

Frankly, this is just incorrect and shows a lack of understanding of basic economics. If you bother to look at any consumer goods market, you will find that historically prices decrease because that is what customers demand more than anything else. Only in markets such as healthcare where the choice is to pay whatever cost is charged or die do you not see the situation you describe and here it's simply a matter of people tending to value their own lives more than anything else. After all, there isn't much point in dying with $10 million dollars as opposed to being alive with only $1 million.

A producer who is unwilling to sell goods at a price that consumers are willing to pay will soon find themselves with a warehouse full of goods and potentially going out of business if they don't rectify their actions. It is the producers who are able to deliver goods and services most cheaply that are chosen by consumers, and this is seen time and time again throughout modern history. Sears mail order was less costly than the general stores in the small towns and replaced them, but then big retail outlets like Wal-Mart became less costly and supplanted Sears (who was forced to go this route themselves in order to stay in business) and now it's an online retailer (Amazon) that's using the old Sears model to replace Wal-Mart and the other stores like it. In time some new company will come along and Amazon will be forced to adapt or perish, much like Sears which at one time surely seemed invincible and able to set whatever prices they wished but was just auctioned off in bankruptcy. At every step of the way, consumers flocked to these companies and then eventually left them because these companies offered consumers the prices that the consumers were most willing to pay. Look at the history of computers in general. Prices have been decreasing the whole time. Consumers wanted cheaper computers and the companies that couldn't supply those cheaper computers are gone. Their perspective on pricing didn't matter.

You cannot sell me something for a price that I'm not willing to pay, no matter how valuable you insist it might be. Perhaps you'll be able to find someone else to pay the price you ask (and that's how we get markets) but it is the producer who is captive to the demands of the consumer. I suspect that when AMD does lower prices and sells some of these chips with more cores for prices that we could not have dreamed of three years ago, it will be Intel that suddenly finds itself in a difficult position. It might have been able to dictate prices for a time due to a lack of competition, but given a choice, consumers will pick lower prices. And if both AMD and Intel were to grow stagnant, they would both find that ARM solutions being offered at lower prices would quickly steal away their customers.

Right now there are billions of people in the world that could be AMD customers, but they're unwilling to pay (more bluntly they can't afford to pay) the price that AMD is charging for a CPU. AMD can set prices where they like, but ultimately it is the consumers who pay them and the only way for AMD to be able to sell to these new customers is to lower their prices to what those consumers as willing to pay. If AMD won't or can't find a way to do that, it will be some other company who does and gets the money of those consumers.

 

[maddie]

Frankly, this is just incorrect and shows a lack of understanding of basic economics. If you bother to look at any consumer goods market, you will find that historically prices decrease because that is what customers demand more than anything else. Only in markets such as healthcare where the choice is to pay whatever cost is charged or die do you not see the situation you describe and here it's simply a matter of people tending to value their own lives more than anything else. After all, there isn't much point in dying with $10 million dollars as opposed to being alive with only $1 million.

A producer who is unwilling to sell goods at a price that consumers are willing to pay will soon find themselves with a warehouse full of goods and potentially going out of business if they don't rectify their actions. It is the producers who are able to deliver goods and services most cheaply that are chosen by consumers, and this is seen time and time again throughout modern history. Sears mail order was less costly than the general stores in the small towns and replaced them, but then big retail outlets like Wal-Mart became less costly and supplanted Sears (who was forced to go this route themselves in order to stay in business) and now it's an online retailer (Amazon) that's using the old Sears model to replace Wal-Mart and the other stores like it. In time some new company will come along and Amazon will be forced to adapt or perish, much like Sears which at one time surely seemed invincible and able to set whatever prices they wished but was just auctioned off in bankruptcy. At every step of the way, consumers flocked to these companies and then eventually left them because these companies offered consumers the prices that the consumers were most willing to pay. Look at the history of computers in general. Prices have been decreasing the whole time. Consumers wanted cheaper computers and the companies that couldn't supply those cheaper computers are gone. Their perspective on pricing didn't matter.

You cannot sell me something for a price that I'm not willing to pay, no matter how valuable you insist it might be. Perhaps you'll be able to find someone else to pay the price you ask (and that's how we get markets) but it is the producer who is captive to the demands of the consumer. I suspect that when AMD does lower prices and sells some of these chips with more cores for prices that we could not have dreamed of three years ago, it will be Intel that suddenly finds itself in a difficult position. It might have been able to dictate prices for a time due to a lack of competition, but given a choice, consumers will pick lower prices. And if both AMD and Intel were to grow stagnant, they would both find that ARM solutions being offered at lower prices would quickly steal away their customers.

Right now there are billions of people in the world that could be AMD customers, but they're unwilling to pay (more bluntly they can't afford to pay) the price that AMD is charging for a CPU. AMD can set prices where they like, but ultimately it is the consumers who pay them and the only way for AMD to be able to sell to these new customers is to lower their prices to what those consumers as willing to pay. If AMD won't or can't find a way to do that, it will be some other company who does and gets the money of those consumers.

"Right now there are billions of people in the world that could be AMD customers, but they're unwilling to pay (more bluntly they can't afford to pay) the price that AMD is charging for a CPU"

Correct, and those arguing for high prices are only seeing the world from a developed country viewpoint. Even poorer peoples have the itch to have great performing things and will scrape to upgrade a CPU model if the prices can be tolerated. We are after all human in our desires.

 

[daperl]

You can talk about economic theory all you want, but I think Intel and AMD will be price fixing. If you accept this you will be less affected by this summer's sticker shock.

 

[Mockingbird]

Frankly, this is just incorrect and shows a lack of understanding of basic economics. If you bother to look at any consumer goods market, you will find that historically prices decrease because that is what customers demand more than anything else. Only in markets such as healthcare where the choice is to pay whatever cost is charged or die do you not see the situation you describe and here it's simply a matter of people tending to value their own lives more than anything else. After all, there isn't much point in dying with $10 million dollars as opposed to being alive with only $1 million.

A producer who is unwilling to sell goods at a price that consumers are willing to pay will soon find themselves with a warehouse full of goods and potentially going out of business if they don't rectify their actions. It is the producers who are able to deliver goods and services most cheaply that are chosen by consumers, and this is seen time and time again throughout modern history. Sears mail order was less costly than the general stores in the small towns and replaced them, but then big retail outlets like Wal-Mart became less costly and supplanted Sears (who was forced to go this route themselves in order to stay in business) and now it's an online retailer (Amazon) that's using the old Sears model to replace Wal-Mart and the other stores like it. In time some new company will come along and Amazon will be forced to adapt or perish, much like Sears which at one time surely seemed invincible and able to set whatever prices they wished but was just auctioned off in bankruptcy. At every step of the way, consumers flocked to these companies and then eventually left them because these companies offered consumers the prices that the consumers were most willing to pay. Look at the history of computers in general. Prices have been decreasing the whole time. Consumers wanted cheaper computers and the companies that couldn't supply those cheaper computers are gone. Their perspective on pricing didn't matter.

You cannot sell me something for a price that I'm not willing to pay, no matter how valuable you insist it might be. Perhaps you'll be able to find someone else to pay the price you ask (and that's how we get markets) but it is the producer who is captive to the demands of the consumer. I suspect that when AMD does lower prices and sells some of these chips with more cores for prices that we could not have dreamed of three years ago, it will be Intel that suddenly finds itself in a difficult position. It might have been able to dictate prices for a time due to a lack of competition, but given a choice, consumers will pick lower prices. And if both AMD and Intel were to grow stagnant, they would both find that ARM solutions being offered at lower prices would quickly steal away their customers.

Right now there are billions of people in the world that could be AMD customers, but they're unwilling to pay (more bluntly they can't afford to pay) the price that AMD is charging for a CPU. AMD can set prices where they like, but ultimately it is the consumers who pay them and the only way for AMD to be able to sell to these new customers is to lower their prices to what those consumers as willing to pay. If AMD won't or can't find a way to do that, it will be some other company who does and gets the money of those consumers.

That's one big red herring.

1. I never said anywhere that AMD should set price above what consumers would buy and end up with a surplus. I said to set the price at market price.

2. AMD is already selling at lower prices than Intel and I see no indication that Intel plans undercut AMD any time in the future.

3. AMD's Athlon 200GE is $60 USD. What do you think it should be? Free after main-in rebate? I am sorry if you live in a Sub-Sahara Africa and can't afford it, but AMD has to pay the bills too.

 

[maddie]

That's one big red herring.

1. I never said anywhere that AMD should set price above what consumers would buy and end up with a surplus. I said to set the price at market price.

2. AMD is already selling at lower prices than Intel and I see no indication that Intel plans to sell at lower prices than AMD anytime time soon.

3. AMD's Athlon 200GE is $60 USD. What do you think it should be? Free after main-in rebate? I am sorry if you live in a Sub-Sahara Africa and can't afford it, but AMD has to pay the bills too.

And what exactly are the bills, seeing as their margins are increasing.

 

[Atari2600]

And what exactly are the bills, seeing as their margins are increasing.

I believe they have quite a few bonds coming up between now and 2020.

They also will have to pay TSMC higher manufacturing costs for 7nm.

They also will have to amortize higher design costs for 7nm across their range.

They also badly need to get their ATi division into a market leading position for HPC (and I suppose to a lesser extent GPUs and APUs). That won't come cheap.


Then the bigger one - they need to diversify the company - or at least diversify revenue streams. ARM is eating into the x86 space all the time. The risk is not ARM overtaking x86 for high performance - it is ARM marginalising x86 into a niche where a company reliant on it (i.e. AMD) is shrunk to a point where it is unable to develop new markets. Now that won't happen overnight - but there is a risk over the next 5 years x86 reaches its apogee in consumer space, and maybe even server space, with it retaining dominance in the HPC space.

 

[Kocicak]

Because that is what a well run manufacturer looking to maximize profit would do, and AMD under Lisa Su, is a well run manufacturer.

AGAIN: There are two main objectives of the business: profit maximisation OR market share increasing - that means sales maximisation. Sales maximisation is accomplished by low prices.

AMD needs to increase their market share at this point.

 

[Mockingbird]

And what exactly are the bills, seeing as their margins are increasing.

Let's Ignoring that Matisse probably more expensive to produce than Summit Ridge/Pinnacle Ridge. (at the time of release)

Let's say that Matisse actually costs less to produce than Summit Ridge/Pinnacle Ridge. (at the time of release)

That doesn't mean that AMD is going to lower prices.

What would cause AMD to lower prices is Intel (its competitor) lowering its prices.

 

[Topweasel]

AGAIN: There are two main objectives of the business: profit maximisation OR market share increasing - that means sales maximisation. Sales maximisation is accomplished by low prices.

AMD needs to increase their market share at this point.

Yeah I don't want to to get trapped into a world of "wishful thinking" and I mean I think we all wish for lower prices on everything we buy. But AMD's job right now is to claw back market share.

No one is suggesting not making a profit. No one is saying bottom out the prices of their CPU's. But AMD's first order of business is not to slightly price their stuff under Intel and hope for the best. It's to come off as almost "you'd be stupid not to" when purchasing an AMD CPU. AMD has already set an upper limit on their pricing of AM4 CPU's at $500 when the nearest competitor one they were actually pretty close to in performance was $1000. I could see them pushing that limit up, but not to the point where they are charging $800+ for a CPU when they still have TR to fill that void.

 

[Mockingbird]

AGAIN: There are two main objectives of the business: profit maximisation OR market share increasing - that means sales maximisation. Sales maximisation is accomplished by low prices.

AMD needs to increase their market share at this point.

AMD can't take market share from itself (obviously), but AMD can take market share from Intel.

That means swaying consumers who intended to buy products such as the Core i7-8700K, Core i7-9700K, and Core i9-9900K.

Products such as the Ryzen 7 3700X and Ryzen 9 3800 provide compelling alternatives to those consumers.

$329 8C/16T Ryzen 7 3700X with similar performance to Core i9-9900K

$499 12C/24T Ryzen 9 3800 with 50% more cores/threads than Core i9-9900K

 

[Topweasel]

Let's Ignoring that Matisse probably more expensive to produce than Summit Ridge/Pinnacle Ridge. (at the time of release)

Let's say that Matisse actually costs less to produce than Summit Ridge/Pinnacle Ridge. (at the time of release)

That doesn't mean that AMD is going to lower prices.

What would cause AMD to lower prices is Intel (its competitor) lowering its prices.

Or too increase incentive to purchase an AMD product or deincentivize Intel purchases. You know exactly what AMD said they were trying to do since Zen 1 launch which is to offer disruptive pricing.

 

[Mockingbird]

Or too increase incentive to purchase an AMD product or deincentivize Intel purchases. You know exactly what AMD said they were trying to do since Zen 1 launch which is to offer disruptive pricing.

AMD prices are already lower than Intel's.

When Zen first came out, AMD didn't have any competitive product on the market (until then), so AMD had nothing to lose.

 

[PeterScott]

AGAIN: There are two main objectives of the business: profit maximisation OR market share increasing - that means sales maximisation. Sales maximisation is accomplished by low prices.

AMD needs to increase their market share at this point.

Lowering your prices can increase your market share, IF your competition does not respond.

And as pointed out above, AMD already has a huge chunk of the low end of the market, then all they accomplish on the low end by lowering prices, is scuttling their own revenue and margins.

Then if Intel responds with price cuts of their own, then no market share is gained, and AMD scuttle their own high end as well.

You can look at recent Vega 7 and RX 590 prices, to see AMDs willingness (lack of) to lower prices on full display.

 

[maddie]

Lowering your prices can increase your market share, IF your competition does not respond.

And as pointed out above, AMD already has a huge chunk of the low end of the market, then all they accomplish on the low end by lowering prices, is scuttling their own revenue and margins.

Then if Intel responds with price cuts of their own, then no market share is gained, and AMD scuttle their own high end as well.

You can look at recent Vega 7 and RX 590 prices, to see AMDs willingness (lack of) to lower prices on full display.

Where in this world do you see AMD having a huge chunk of the low end of the market? Their market share across the board is small, or do you have more timely info?

 

[Mockingbird]

Where in this world do you see AMD having a huge chunk of the low end of the market? Their market share across the board is small, or do you have more timely info?

Sale figures from online retailers

AMD dominate the ~$200 and under.