It's easy to disrupt the market when you have nothing to lose.
It's no so easy when you have something to lose.
The 10/12-core level of performance is now $650, brand new.
Lots of people will buy a product at $650, who wouldn't at $1700.
Lower price yielding higher sales.
If AMD launches a 12-core R7 at $329, there are even more people who will buy at that price.
I don't know how I'd rationalize a $650 CPU, so I wouldn't buy one.
A $329 dollar, 12-core CPU?
Now I'm interested.
I am not sure if you noticed, but AMD few years ago was very close to bankrupt. They had bad products and very low market share. Now they have good products AND THEY CAN GROW AGAIN. Growth is at this point so important that whole AMD can operate with 0 profit, all they need is to finance their growth and development of the products that will ensure the growth. Only after they grow back and stabilise, they can start to care about profitability again.
AMD is at the moment ALL ABOUT GROWTH.
Die sizes do matter but you implicitly assume the same cost to both fabs per mm^2.Ryzen 3000 desktop part production costs will undoubtedly be more than Intels parts, and almost certainly more than Ryzen 2000 parts.
Anand estimates 9900K die to be ~177 mm2. This is NOT a large die. Not large enough that breaking into smaller pieces would significantly improve yield.
Anands estimate for combined Ryzen 3000 die sizes is ~203 mm2. That IO die is NOT free.
It really isn't even a serious debate:
1: Intel is using less silicon in a size/process maturity where yield is NOT and issue.
2: Intel is using less expensive process for all of the silicon. AMD is using a more expensive process for ~40% of the package.
3: Intel it has simpler design with less manufacturing/testing complexity.
4: Intel captures all CPU revenues, AMD has to share with it's manufacturing partners: TSMC and GF.
Intel has a significant production cost advantage from every angle.
But the 9900k is only that expensive because AMD doesn't yet have a competitor.
The second AMD releases that 8-core, the price for a 9900k drops to match it. Ok, it lags a bit because Intel, but pretty damn soon AMD has to cut prices again because if prices are close, people will go Intel.
Eventually Intel won't be able to cut the price any further, and AMD starts to really pull ahead, but it'll take a while to get there.
AMD can just put the chips on sale with decent (but not Intel) margins, rack up sales that would have gone to Intel's HEDT line, and get lots and lots of AM4 boards into the wild. And do it starting at launch day.
I really think that time is the key.
Intel is having difficulty with production, but it won't last forever, so AMD needs to grab as much marketshare as possible before Intel recovers.
Huh. How is this related to what I wrote?Whatever the market will bear. Price isn't determined by manufacturing costs; revenue is.
If AMD can sell the 8C/16T Ryzen 7 2700X (which doesn't perform close to the 8C/16T Core i9-9900K) for $329, why would AMD sell the 8C/16T Ryzen 7 3700X (with similar performance to the Core i9-9900K) for less than $329?
Sorry, I misread "cost of production" as market price. I'm trying to delete my post so as not to confuse things but it looks like I can't delete, only edit.Huh. How is this related to what I wrote?
Need coffee?
Many of us think it's possible that AMDs new chiplet strategy will allow them to sell cheaper because their product is either significantly cheaper to produce than at any previous time, or they are willing to trade product margins for product volume while maintaining healthy profit margins, or some combination of the above.
You probably live on some other planet, because on this planet lowering the price means increasing sales. Lowering prices to grow is a standard practice, which works.
Because Intel could simply cut prices to match, and lower power draw isn’t nearly the selling point that cost and performance are.
It’s a lot harder for Intel to drop the price of a 12 or 16-core cpu to match AMD. Can you imagine Intel selling 12 cores for under $500? 16 cores?
AMD can do that.
Maybe Intel can too, but it will be a lot more expensive for them.
Ryzen 3000 desktop part production costs will undoubtedly be more than Intels parts, and almost certainly more than Ryzen 2000 parts.
Anand estimates 9900K die to be ~177 mm2. This is NOT a large die. Not large enough that breaking into smaller pieces would significantly improve yield.
Anands estimate for combined Ryzen 3000 die sizes is ~203 mm2. That IO die is NOT free.
It really isn't even a serious debate:
1: Intel is using less silicon in a size/process maturity where yield is NOT and issue.
2: Intel is using less expensive process for all of the silicon. AMD is using a more expensive process for ~40% of the package.
3: Intel it has simpler design with less manufacturing/testing complexity.
4: Intel captures all CPU revenues, AMD has to share with it's manufacturing partners: TSMC and GF.
Intel has a significant production cost advantage from every angle.
It's easy to disrupt the market when you have nothing to lose.
It's no so easy when you have something to lose
You're right, AMD won't sell the R7 3700x for any less than $329. What's incorrect though is making the assumption that it will be 8C/16T. The majority of evidence indicates there's a fair chance it will be 12C/24T, which is what all the arguing has been about.If AMD can sell the 8C/16T Ryzen 7 2700X (which doesn't perform close to the 8C/16T Core i9-9900K) for $329, why would AMD sell the 8C/16T Ryzen 7 3700X (with similar performance to the Core i9-9900K) for less than $329?
The cost associated with making the processors aren't just the cost of the dies.
There are the costs of development (AMD's engineers don't work for free).
Then, there's the cost of manufacturing itself: cost of shipping dies from Taiwan (TSMC) and New York (GloFo), the cost of making the PCBs to install the dies, the cost of installing the dies, etc.
It seems like we agree here. AMD has nothing to lose; they've finally put themselves back into the market with competitive products against Intel and worst case ryzen 3k sells only as well as ryzen 2k and they go back to being stagnant instead of growing.
Intel however has their huge marketshare and high margin enterprise/data customers to lose.
You're right, AMD won't sell the R7 3700x for any less than $329. What's incorrect though is making the assumption that it will be 8C/16T. The majority of evidence indicates there's a fair chance it will be 12C/24T, which is what all the arguing has been about.
This is a very sensitive topic on these fora. There have been individuals here, that have in the past, been found advocating "shilling" for the big companies. The accusations and counters were pretty nasty, so there is a strict policy to never allow this to return. Find another way to make your opinion clear. Most here are pretty smart.
Why didn't you just say this all along. Would have saved pages of posts.Intel hasn't lowered the price, so there's no point for AMD to respond.
evidence
It seems like we agree here. AMD has nothing to lose; they've finally put themselves back into the market with competitive products against Intel
Have you forgotten the chip Lisa Su held up at CES? Or her statements saying that we could expect more than 8 cores coming to Ryzen? FFS stop obsessing about whatever TV you watch and read more.
That's what they stand to lose.
...and what does that have to do with prices?
You're right, AMD won't sell the R7 3700x for any less than $329. What's incorrect though is making the assumption that it will be 8C/16T. The majority of evidence indicates there's a fair chance it will be 12C/24T, which is what all the arguing has been about.
... Did you even read my post? I'm not disputing that AMD is going to price the R7 3700x lower than the 2700X. I agree with you on that.
Edit:typo
If by "it" you mean "R7 3700x" then really it's 100% irrelevant what "it" is (called). What is of importance is core count, performance and price. It'd be even "worse", or more surprising, if AMD released a 12 core CPU at about $330-350. One such CPU performing on par with a 9900K (IPC) would just be money left on the table.
So far AMD's pricing has been pretty linear when it comes to core count, so a 12-core CPU at for example $350 on AM4 would push what essentially is a 9900K-performing 8-core CPU down to about $230. That would be undercutting Intel's CPU by over 50%...
Just seems like bad business to me.
Just seems like bad business to me.