[kitguru] AMD 7970/7950 price drops incoming

[bryanW1995]

http://www.hardwarecanucks.com/foru...hd-7970-price-drop-incoming-2.html#post620341

Grain of salt alert. ^_^

SKYMTL would know, I trust him a lot more than kitguru.

 

[IlllI]

And both of you guys would be wrong. They weren't undercutting Nvidia. They were priced where you would expect a card to be with the performance compared to competition they were at.

oh really? so you think this http://www.anandtech.com/show/5026 is a sign of amd thriving and being successful? they are hardly making any money

 

[bryanW1995]

War my *&^. They are making a fortune off these parts. And not enough.

7970 needs to drop $100
7950 $100
7870 $60
7850 $20

AMD really screwed up with thier pricing this round - tons of threads relaying disappointment and I think these cuts will sell well and get AMD in our good graces again.

Oh yeah you're right 7870 was a joke @ $359. Not much faster than GTX 570 which was selling for $270 for last 2 months. $90 less. I bet nV sold more of this old tech than AMD 7870s due to horrendous pricing. There are only like a few reviews at newegg on 7870s indicating hardly no one bit.

7870 is very close to 580gtx according to Anandtech's GPU comparison.

7870 wasn't nearly as overpriced as 7970 was. 7870 is ~ 10% faster than gtx 570, plus it's quieter, overclocks better, uses less power, and produces less heat. And the gtx 570 was selling way below MSRP at $270, the actual difference in MSRP between the 2 cards was closer to $50, which is a much more reasonable difference for a new card with all of the aforementioned advantages. Now, if you want to talk about a joke in pricing, the 7970 at $550 fit that pretty well imho...

 

[blastingcap]

And both of you guys would be wrong. They weren't undercutting Nvidia. They were priced where you would expect a card to be with the performance compared to competition they were at. What AMD did that made the last 3 gens so great as they had almost 3 different variations at each level, which meant they could be more competitive in pricing. Which mean there was always a better alternative at every level except the top line. With no competition means high end pricing. Look at current pricing and the next price drop, and all Nvidia has released is one card.

When 670 and 660 are released expect more price drops and price adjustments. Then once the dust has settled, my guess, is once again AMD will have the high, mid high, and middle level performance per $ kings. While Nvidia has the top dog award.

Most likely AMD is preemptively dropping prices because it doesn't want to look bad in reviews again. If they manage to drop prices before NV's next launch, the reviewers may be more like "meh, it's about the same price/perf." If AMD didn't do this, reviewers would just dogpile onto AMD saying how the NV card is better value... just like they did with gtx 680 vs. 79xx. It creates a lasting impression... just look at the 5830. It's not a bad card per se, but at launch prices it had terrible price/perf and it never quite lived down that reputation.

NV knows how to play the reputation game. Look at how they dropped prices on GTX 460 parts by ~$20 literally right as AMD launched the 68xx series. If NV didn't do that, the reviewers would all gush over AMD and make NV look bad. And NV even gave money back to early adopters of GTX 280's thanks to the released-almost-at-the-same-time 4870 torpedoing the GTX 280 price/perf.

 

[Elfear]

7870 wasn't nearly as overpriced as 7970 was. 7870 is ~ 10% faster than gtx 570, plus it's quieter, overclocks better, uses less power, and produces less heat. And the gtx 570 was selling way below MSRP at $270, the actual difference in MSRP between the 2 cards was closer to $50, which is a much more reasonable difference for a new card with all of the aforementioned advantages. Now, if you want to talk about a joke in pricing, the 7970 at $550 fit that pretty well imho...

I paid $300 a piece for my 6950's on launch day and my 7970 for $550 provides a better gaming experience. I feel like I got my money's worth. *shrugs*

 

[bryanW1995]

While that is no doubt true, the 7970 also did almost nothing to advance the price/performance curve of the high end. AMD was smart to focus on building a solid gpu that could also double as a professional card's gpu, but that focus somewhat hindered their ability to deliver top-notch gaming performance. At least gtx 680 pushed the envelope by releasing a faster/quieter/cheaper power-sipper of a card.

 

[Zebo]

7870 wasn't nearly as overpriced as 7970 was. 7870 is ~ 10% faster than gtx 570, plus it's quieter, overclocks better, uses less power, and produces less heat. And the gtx 570 was selling way below MSRP at $270, the actual difference in MSRP between the 2 cards was closer to $50, which is a much more reasonable difference for a new card with all of the aforementioned advantages. Now, if you want to talk about a joke in pricing, the 7970 at $550 fit that pretty well imho...

I don't agree. The highest end NEVER follows price performance. There is psychological value with this segment. There's nothing to debate about buying strategy they simply go out and purchased the very best parts available and premium is expected. There is really two ways to look at it. Always a poor value or I got the best and that's worth it (kid in candy store/ego satisfied)

You're wrong about speed. It's 5% and was not worth ~25% more money. Who cares about MSRP? GTX 570 were selling at $270 while 7870s were $360. That's reality.


Another cold hard reality is nVidia has better name brand so AMD must come in better p/p not worse if they like selling cards.

 

[Gikaseixas]

According to that graph, 7870 is only 7% slower than GTX 580 and much cheaper. Anyways, better oc results than GTX 570 while consuming less, it's a winner in my eyes.

 

[Zebo]

Most likely AMD is preemptively dropping prices because it doesn't want to look bad in reviews again. If they manage to drop prices before NV's next launch, the reviewers may be more like "meh, it's about the same price/perf." If AMD didn't do this, reviewers would just dogpile onto AMD saying how the NV card is better value... just like they did with gtx 680 vs. 79xx. It creates a lasting impression... just look at the 5830. It's not a bad card per se, but at launch prices it had terrible price/perf and it never quite lived down that reputation.

NV knows how to play the reputation game. Look at how they dropped prices on GTX 460 parts by ~$20 literally right as AMD launched the 68xx series. If NV didn't do that, the reviewers would all gush over AMD and make NV look bad. And NV even gave money back to early adopters of GTX 280's thanks to the released-almost-at-the-same-time 4870 torpedoing the GTX 280 price/perf.

You get it blasting cap. Every reviewer justifiably panned those 7800 prices. Buying Public takes that to heart as well. That's bad. Meanwhile nV pulled $500 screamer and reviewers lauded it. First impressions are most important unfortunately AMD has idiots in price department.

 

[Zebo]

According to that graph, 7870 is only 7% slower than GTX 580 and much cheaper. Anyways, better oc results than GTX 570 while consuming less, it's a winner in my eyes.

That's not saying much, GTX 580 is the most overpriced single card out right now. I don't compare bad to worse.

 

[Zebo]

While that is no doubt true, the 7970 also did almost nothing to advance the price/performance curve of the high end. AMD was smart to focus on building a solid gpu that could also double as a professional card's gpu, but that focus somewhat hindered their ability to deliver top-notch gaming performance. At least gtx 680 pushed the envelope by releasing a faster/quieter/cheaper power-sipper of a card.

Top dog always get huge premiums. You sound a little bias anyway. 7970 did sip power compared to previous top dog GTX 580.

 

[Gikaseixas]

That's not saying much, GTX 580 is the most overpriced single card out right now. I don't compare bad to worse.

GTX 570 is worse than 7870 in every aspect but price, some people will prefer to pay the premium, some (like you apparently) will not.

 

[Zebo]

GTX 570 is worse than 7870 in every aspect but price, some people will prefer to pay the premium, some (like you apparently) will not.

Not many judging by the low review count of 7870 at newegg. So it appears I'm not alone.


I will pay premium for the best, GTX 680 which I got day 1, but not a middle card at high end price.

 

[SickBeast]

The 7870 is not worth the premium over the 7850 as it is only faster by 3-5% clock-for-clock. Why people pay 50% extra for that few percent baffles me.

 

[Zebo]

The 7870 is not worth the premium over the 7850 as it is only faster by 3-5% clock-for-clock. Why people pay 50% extra for that few percent baffles me.

You're not alone. Everyone who is honest realize 7870 is no go at $350.

This middle card debate applies to people without the ability or willingness to purchase the very best available. This vast majority of people, and sensible people must consider price/performance ratios. And 7870 is terrible. So is GTX 580 so is anything in the $300-$400 range when you can buy equivalent parts once both overclocked tie them for $150-$200 less money.

 

[Topweasel]

oh really? so you think this http://www.anandtech.com/show/5026 is a sign of amd thriving and being successful? they are hardly making any money

If you knew the history of AMD then that is them doing exceptionally well. But that isn't the point. The point is pricing in a particular market. A high Margin market.

Most likely AMD is preemptively dropping prices because it doesn't want to look bad in reviews again. If they manage to drop prices before NV's next launch, the reviewers may be more like "meh, it's about the same price/perf." If AMD didn't do this, reviewers would just dogpile onto AMD saying how the NV card is better value... just like they did with gtx 680 vs. 79xx. It creates a lasting impression... just look at the 5830. It's not a bad card per se, but at launch prices it had terrible price/perf and it never quite lived down that reputation.

NV knows how to play the reputation game. Look at how they dropped prices on GTX 460 parts by ~$20 literally right as AMD launched the 68xx series. If NV didn't do that, the reviewers would all gush over AMD and make NV look bad. And NV even gave money back to early adopters of GTX 280's thanks to the released-almost-at-the-same-time 4870 torpedoing the GTX 280 price/perf.

I really have to wonder about education in this country. Is it me or did no one have Econ in college, or spend a couple weeks in High School Social Studies studying Econ?

Step 1. Create a product.
Step 2. Analyze market.
Step 3. Analyze stock.
Step 4. Analyze production costs.
Step 5. Release product into market at a profitable level with pricing based on competition so that you amount of product you want.

They released 6 products and priced them at the performance levels of their competition at the time of release.

When a company lowers prices its A.) Increase Demand due to competition. B.) To clear stock. C.) To increase market-share.

Since this is a recent release lets assume that wasn't clear stock. If it was to increase market-share, the cards would have had the price slotting set lower to begin with. Since they were pricing it based on competitive performance its doubtful they would change pricing models mid stream. That means it was based on increasing the cards demand. Since a new card came out a couple weeks ago, priced less while faster, it makes sense.

That is the one and only reason. If another card comes out and impacts the sales, then AMD will once again be forced to reduce prices. But guess what. It is obvious that it was from the beginning the plan all along. How do I know this? Because it's what all companies do. All of them. Specially in markets as volatile as this one.

 

[blastingcap]

I really have to wonder about education in this country. Is it me or did no one have Econ in college, or spend a couple weeks in High School Social Studies studying Econ?

Step 1. Create a product.
Step 2. Analyze market.
Step 3. Analyze stock.
Step 4. Analyze production costs.
Step 5. Release product into market at a profitable level with pricing based on competition so that you amount of product you want.

They released 6 products and priced them at the performance levels of their competition at the time of release.

When a company lowers prices its A.) Increase Demand due to competition. B.) To clear stock. C.) To increase market-share.

Since this is a recent release lets assume that wasn't clear stock. If it was to increase market-share, the cards would have had the price slotting set lower to begin with. Since they were pricing it based on competitive performance its doubtful they would change pricing models mid stream. That means it was based on increasing the cards demand. Since a new card came out a couple weeks ago, priced less while faster, it makes sense.

That is the one and only reason. If another card comes out and impacts the sales, then AMD will once again be forced to reduce prices. But guess what. It is obvious that it was from the beginning the plan all along. How do I know this? Because it's what all companies do. All of them. Specially in markets as volatile as this one.

If you are going to make faulty assumptions and assertions, you would do well to at least not attack other people. Or perhaps you aren't self-aware enough to know how it makes you sound.

First of all, I don't even know what to say if you believe so much in neoclassical economics. They are stylized models based on faulty assumptions such as perfect competition, perfect information, "rational" economic players, rational utility curves, etc. The models are broken. You can try to paper it over with ad hoc fixes, but the model is fundamentally broken for all sorts of reasons, whether they are obvious market failures (monopolies, oligopolies, asymmetric information, etc.) or because the system fails to capture the human element in decision-making and true impact on happiness, aka subjective well-being. For you to come marching in here and diss everyone else because you've had a couple of econ courses is really, really sad, and not for us, but for you.

Second, even if you are a Kool-Aid drinking True Believer in neoclassical microeconomics, guess what? Companies operate on multiple time horizons, including short term and long term decision-making. There are countless examples of companies eating short term losses for the sake of long term gains, such as in the console market. Furthermore, you seem to have absolute faith in companies making the "right" decision always. They don't. We'll just leave it at that.

Third, you have to look at history a little bit here. AMD's pricing has won market share and positive feelings but done a lot less for the bottom line. The last time there was a difficult node switch, AMD priced 5xxx's so low that retailers marked them up--and they still sold out. AMD probably didn't want the same thing to happen again, so they priced a little high with the idea that if there was a supply/demand imbalance like the 5xxx series again, that at least they would reap more profit instead of price-gouging retailers. This coupled with AMD's new CEO's attitude probably resulted in AMD charging as much as they figured they could get early adopters to pay, with the idea that they would simply lower prices depending on how good NV's chip turned out to be. I have little doubt that AMD planned to drop prices once they lost market power due to competition. It was probably part of the plan all along and not something done on the spur of the moment to "increase demand."

Fourth, AMD has apparently been crunching the numbers on how NV's product is affecting its own sales and has determined that a price drop would be in its best interest for whatever reason: market share (short term vs. long term thinking, again), maximizing revenue or profit, or who knows what else. Maybe TSMC fixed its 28nm process and that's changed AMD's cost forecast.

Fifth, your drivel about how companies operate hardly merits any discussion, but I will say this: you do not create a product and then analyze the market unless you want to fail as a business or else have a truly disruptive product. No, a GPU doesn't count, certainly not the way AMD has been going about it at least. (NV has made inroads into HPC that AMD can only dream of.) Market analysis is ongoing. Engineering tries to come up with a good product and they try to figure out a good balance in terms of performance to wattage to noise to cost to manufacture to everything else, with input from marketing as needed. It can be a highly iterative process in some cases. And prices can always fluctuate, though companies usually try to avoid raising prices because of the optics of the situation, so there is a bias towards overcharging a bit and then easing off prices if necessary, via sales, rebates, or "freebies" like free copies of DiRT3. Lastly, you try to forecast the market and price accordingly, with an eye on stock built up as well as ongoing manufacturing capacity throughout the life cycle of the product.

Lastly, your additional drivel on why companies lower prices is horribly oversimplified and misses tons of other possibilities, such as lower cost of production, matching supply/demand imbalances, or even something as pedestrian as attempting to make quarterly numbers look better for the sake of keeping a lid on borrowing costs or whatever else. Even among the three cases you cite, there are numerous other potential explanations. They may well be attempting to clear a temporary overstocking situation building up in the pipeline; or they may have figured that they would gain market share even with an early adopter tax and are now being more aggressive chasing it; and even your nebulous "increasing demand" which I take to mean "increasing quantity demanded" fails to address fundamental drivers for that, such as wanting more profit or revenue.

The reason why I suspect the drop in prices is due to stockpiles accruing due to so much demand for high-end cards being shifted to NV, and the threat of NV's imminent other 28nm releases. Part of the reason why the GTX 680 is so popular is because it was a clear victory at its price point, to the point where every single reviewer recommended the GTX 680 over the competition. AMD knows that by dropping prices now, it is stealing a page from NV's playbook. NV has no compunction about undermining AMD's launches by undercutting it on prices when possible (though NV drags its heels when it can't, like with the GX 2xx series when the HD 5xxx series came out), because it understands the concept of mindshare and burnishing reputations early on. The GTX 460 price drop on the day of the HD 68xx launch is a classic example. Note that GTX 680 inventories are nil at major retailers. AMD is not dropping prices due to today's temporarily nonexistent competition... no, they are either stuffed to the gills in the channel, or worried about the future, or both. If I left out any part of my analysis it is because I thought it was OBVIOUS what the link was between reviewers and demand, among other things. Apparently some people need it spelled out for them. Do I need to also spell out how demand affects sales revenue, and thus profits, too? And note that unlike your smugness, I considered other possibilities such as lower 28nm costs, whereas you self-congratulatorily said there could be only one possible reason. Okay, Sherlock.

 

[Zebo]

I want to throw this out to show what a shitty value 7870 is/was

http://www.newegg.com/Product/Produc...82E16814130758

This card beats $350 7870 for $239

Here is a slower version of it reviewed. One above is faster "ultra" version being clocked even higher!
http://hexus.net/tech/reviews/graphics/36565-evga-geforce-gtx-560-ti-448-classified/?page=6

Maybe I was wrong about $299.. 7870 should be more like $269 slash $100 off of her too like rest of AMD line up needs.

 

[blastingcap]

I want to throw this out to show what a shitty value 7870 is/was

http://www.newegg.com/Product/Produc...82E16814130758

This card beats $350 7870 for $239

Here is a slower version of it reviewed. One above is faster "ultra" version being clocked even higher!
http://hexus.net/tech/reviews/graphics/36565-evga-geforce-gtx-560-ti-448-classified/?page=6

I don't know about "beats," you may want to check that again.

Anyway, I've been saying the same thing. Old 40nm parts are price-competitive or even cheaper from an initial price/perf perspective. To be fair though the 7870 has less power/noise/heat, can probably oc a bit better, and definitely has more VRAM (2GB vs. 1280MB), though few people will really benefit from it right now. All for a stiff price, though.

 

[SickBeast]

AMD had better have all those advantages because IMO nVidia:

- has better drivers; definitely their control panel is better at the very least

- has PhysX

- has CUDA

- has better developer relations

 

[Zebo]

I don't know about "beats," you may want to check that again.

Anyway, I've been saying the same thing. Old 40nm parts are price-competitive or even cheaper from an initial price/perf perspective. To be fair though the 7870 has less power/noise/heat, can probably oc a bit better, and definitely has more VRAM (2GB vs. 1280MB), though few people will really benefit from it right now. All for a stiff price, though.

It beats it enough to call 7870 overpriced Also, that PCB is built like a tank with 8 phase power (compared to ref 4) high end cooling. Has lifetime warranty, nV banding and trade up. - if we're going to niggle over minutiae... Bottom line price performance on 7870 is ridiculous.

 

[blastingcap]

It beats it enough to call 7870 overpriced Also, that PCB is built like a tank with 8 phase power (compared to ref 4) high end cooling. Has lifetime warranty, nV banding and trade up. - if we're going to niggle over minutiae... Bottom line price performance on 7870 is ridiculous.

To repeat: I agree with you in general that the 7870 is overpriced. Hell, all 7xxx cards are overpriced to varying degrees, compared to 40nm cards, especially if you wait for a sale.

As to that particular 448 card, if you oc'd both 448 and 7870 to maximum I doubt the 448 would win, so I don't know how proper it is say it it "beats" the 7870. And I just mentioned the VRAM and power/noise/heat because it's not entirely one-sided. NV has the bonuses you mentioned and CUDA/PhysX of course.

 

[blackened23]

I want to throw this out to show what a shitty value 7870 is/was

http://www.newegg.com/Product/Produc...82E16814130758

This card beats $350 7870 for $239

Here is a slower version of it reviewed. One above is faster "ultra" version being clocked even higher!
http://hexus.net/tech/reviews/graphics/36565-evga-geforce-gtx-560-ti-448-classified/?page=6

Maybe I was wrong about $299.. 7870 should be more like $269 slash $100 off of her too like rest of AMD line up needs.

Seeing as how the 7870 beats the GTX 570 at stock speeds, and you're saying the 448 beats the 7870? No, thats incorrect. The review you are linking shows a 448 while overclocked and compared it to the stock 7870, while simultaneously the 7870 beat the 570 in every test if I remember right. I think its safe to say that the 7870 would overclock better than the 448.

http://www.anandtech.com/bench/Product/518?vs=548

Should the price of the 7870 be lower? Sure. But the 7870 at stock beats the 448 and GTX 570 at stock and overclocks better and has 2gb of VRAM. Personally I think its safe to say the 7870 will overclock better than the 448, since many oc'ed 7870s are matching 7950 stock performance.

 

[Zebo]

That's a classified ultra 448, beats GTX 570 ez pz for $239.

Oh and 448 clocks higher than GTX 580s and 570s due to dead space thus running cooler. Most ppl get 950 quite ez. When you are starting with higher IPC than 7870 I suggest 150Mhz OC is same as +200Mhz you will get out of 7870. But OCing is never guaranteed. Stock stock that $239 card beats $350 7870.

 

[blackened23]

That's a classified ultra 448, beats GTX 570 ez pz for $239.

Of course, you didn't have the courtesy to compare an overclocked 7870 to the overclocked 448. Sure the 448 is a great value, but i'm pretty certain the overclocked 7870 would beat it by quite a bit - since many 7870s are matching stock 7950s. Is that worth the additional money? For a budget gamer no. That 448 is a great deal, I didn't even realize how well it performed until I just checked it out. It doesn't beat the 7870 though all things considered.

Anyway, I definitely agree the 7870 should be price cut along with everything else. I'm also pretty impressed with that 448 model, I didn't realize it performed that well.