Originally posted by: dreddfunk
SexyK - thanks for the reply, and I'm not really taking it personally. I'm just making sure everyone knows that there is a distinction between attacking a point (valid) and attacking a person (not). I don't think you're argument is rampantly illogical. Although I'd say a few things in reply.
First, I think AMD's stock is taking a beating because their much larger competitor in a different market (Intel) has the performance crown and is willing to engage in a price war that hurts their own profitability in order to punish a rival (AMD). I think R600's delay has got nothing to do with AMD's stock going in the tubes, except in so far as the ATI acquisition has placed AMD in a delicate financial condition because of the money involved.
Second, newegg.com is almost certainly, as you concede, more of an indicator of enthusiast and, perhaps, the performance crowd. Out of those 58 cards, there are only two (two!) that are under the 7600GS level. You've got 4x7600GS and 5x7600GT. Out of 58 "top sellers" they have 11 cards that are actually midrange or lower. Quite frankly, there are two things going on: 1) newegg caters to a more performance and enthusiast crowd, and 2) newegg is shuttling customers to their more lucrative products.
Third - Losing mind share of newegg.com customers will certainly eventually filter down but, given just how much of the market is only interested in very low end GPU solutions, I can neither agree with the presumption that newegg's top sellers list is a good indicator of the market, nor that the correlation between high-end dominance and overall market success is a cause-and-effect relationship. Indeed, Intel is the leading provider of graphics solutions by far and it has nothing whatsoever that competes with nVidia or AMD(ATI) high-end offerings.
Now, nVidia is placed extremely well in a smaller market that revolves much more around performance, but here again, the profitability mentioned in the article doesn't come from high-end GPU sales.
" The company's gross margin was 43.9%, slightly ahead of its expectations, and close to the long-term target of 45%. While average selling prices of desktop PC graphics chips declined slightly quarter over quarter, strong sales of notebook chips helped Nvidia increase its gross margin in all major business segments during the fourth quarter.
Nvidia launched its GeForce 8800 graphics chip in November, putting it well ahead of rival ATI, which is expected to field its answer sometime in the current quarter.
But Nvidia's head start has not really helped it that much, says Stifel Nicolaus analyst Blake Fischer, as there's scant games and other applications currently available that take advantage of the chip's most advanced features. Stifel Nicolaus makes a market in Nvidia shares.
According to Nvidia, fourth quarter-sales growth was primarily the result of strength in the company's business supplying chipsets, which were up 89% year over year. Graphics chips for notebook PCs surged 120% year over year."
I'm not sure that we can really see high-end GPU dominance as the cause that has driven nVidia's profitability. Has it correlated with that profitability? Yes. Is there a clear cause-and-effect relationship? No. Of course, I'd be very curious to see how much of their mobile revenue is from higher-end chips based off the 7800/7900 series architecture. I would count those as "high-end" sales. My guess, however, is that most of those sales are in the mid- and low-range (7600 and below) as well.
Finally, I don't agree with your analysis of the timing issue, and here's why. Yes, nVidia has a refresh of the G80 in the works. I sincerely doubt, however, that they will get large numbers of the refresh manufactured until they see R600 benchmarks. If they really want the refresh to beat the R600, they'll need to see benchmarks. They'll need enough time after the benchmarks to tweak the refresh, and put it in the manufacturing pipeline for launch. That is going to take 2-3 months, at least. My whole point about the delay has been this: if I am ATI, I want that 2-3 month period to coincide with the release of "must-have" DX10 games. I do not, under any circumstances whatsoever, want that 2-3 month period to coincide with the 2-3 month period immediately prior to the release of these DX10 titles. Do you see my point? If I release R600 2-3 months before "must-have" DX10 titles arrive, I would give nVidia precisely the amount of lead time they need in order to take back the performance crown when it matters most: when DX10 titles arrive.
This
is an ATI/AMD screw-up. It just happened a long time ago. It happened when they couldn't get R600 out the door last October/November/December. Back then, they could have forced nVidia's hand; they could have forced a G80 refresh and still had time for the R600 refresh right before DX10 titles came out. That would have been ideal for all of us--great competition. Once they didn't get their act together in time to do that, R600 problems or not, I wouldn't have released it in March of this year. At that point it just strikes me as bad, bad, bad timing. I've never implied that ATI/AMD didn't screw up. I'm just not convinced they screwed up with this latest delay. That actually made weird sense to me.
The bottom line is this. As you've said, nVidia has the refresh ready. The question is, when does ATI/AMD get hammered with it. If I'm them, I want that to be 2-3 months after DX10 games come out. Hopefully, I've at least regained some mind and market share by having the top performer out at the right time. As I said before, under no circumstances do I want to get hammered by the G80 refresh just as DX10 games are coming out. No way.
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