AMD RX Vega’s pricing was “not just for launch, but ongoing”

[Mihle]

As I expected.

[Energycore]

5 hours ago, PCGuy_5960 said:

AMD really needs to solve the supply issues, so that the cards can be available at the MSRP.

The thing is, solving supply issues for a video card means literally getting a new silicon fab. And you need money for that which AMD doesn't have much of. But I hope that at least with the revenue made they can start putting more money into RTG because they really need a helping hand.

[Dylanc1500]

19 minutes ago, Energycore said:

The thing is, solving supply issues for a video card means literally getting a new silicon fab. And you need money for that which AMD doesn't have much of. But I hope that at least with the revenue made they can start putting more money into RTG because they really need a helping hand.

They should lease one of Intel's Fabs. Highly unlikely but it would be interesting to see if they would allow AMD to have some of their fabulous silicon.

[LAwLz]

So either someone is lying (board partners and stores, vs AMD) or you have to read between the lines.

Since I usually believe companies don't flat out lie I'm going to go with the latter option and think that this statement was carefully crafted to be interpreted one way, while also meaning something else.

 

He never denied giving rebates to stores so that part might still be true. They might have given stores a 100 dollar rebate in order to keep the prices at 500.

Once the rebate expired the price shot up to 600 dollars (or more?) which AMD expected.

 

AMD most likely wants the card to sell for 500 dollars, but as he said they don't really control the prices. But, they do control the cost of plenty of things, such as the GPU itself (and memory in this case), as well as the reference PCB. So while they don't control the prices of partner cards directly, they do control the price of the largest expenses when building a card, which plays the biggest role in what the cost of cards ends up being.

 

So to me, the most logical explanation is this:

1) AMD realized that making Vega chips is expensive as fuck.

2) They put the price for the chips accordingly.

3) AMD realize that with the prices for the GPU they set, the board partners would put the price at around 600 dollars in order to hit their margins.

4) AMD announces that the card will have an MSRP of 500 dollars, and then start giving 100 dollar rebates to stores in order to hit that price target.

5) As time goes on, AMD will try and bring the cost of the Vega chips down (for example with higher yields), so that they can pass the savings over to the board partners, which can then lower the prices and still hit the margins they want.

 

That would explain everything I can think of, and nobody would technically be lying.

[SpaceGhostC2C]

4 hours ago, JoostinOnline said:

They're worth almost 33 BILLION USD.  And that's just the Japan company, not NOA.

 

3 hours ago, AshleyAshes said:

 

Just to be clear, Nintendo's cash reserves are in excess of 5 billion USD.  Nintendo actually DOES have money to sit on and it is a very large, comfortable seat with lots of cup holders.

 

The problem is capital isn't happy when it's idle. Things like market capitalization and cash reserves (which are themselves different things) don't make up for lack of profits. A company can have no profits, or even sustain losses, for long periods if investors believe it is building the foundations for substantial profits in the future. However, with no such prospects, companies can't simply "sit": yes, they won't necessarily go bankrupt, but lack of profit expectations will lead to stock sales, stock sales will lead to lower stock prices (even "higher, but lower than expected" would be enough, we are not discussing a major crash here), unsatisfactory stock prices lead to unhappy stockholders, unhappy stockholders leads to a change in management.

Bottom line: a company can have a high market valuation and large cash reserves, and that still won't make its CEO act like (s)he can wait forever to make higher profits.

And remember: market cap = #shares * stock price, where "stock price" is what someone actually last paid for a share. So, high market cap means either the company is really big (hence a lot of capital to have just idling) or someone expected a lot more than "sitting around" from the company...

[Misanthrope]

So tl;dr version:

 

People - Prices are still shit

AMD - 

 

 

[Coaxialgamer]

1 hour ago, Energycore said:

The thing is, solving supply issues for a video card means literally getting a new silicon fab. And you need money for that which AMD doesn't have much of. But I hope that at least with the revenue made they can start putting more money into RTG because they really need a helping hand.

The problem isn't the fabs. Globalfoundries still has quite a bit of capacity left, even considering their other customers. 

It's yields. Probably not on the actual gpus if i had to guess. Likely to be on the side of the hbm2 suppliers. 

This new tech simply isn't prepped for very high volume. 

[Energycore]

Just now, Coaxialgamer said:

The problem isn't the fabs. Globalfoundries still has quite a bit of capacity left, even considering their other customers. 

It's yields. Probably not on the actual gpus if i had to guess. Likely to be on the side of the hbm2 suppliers. 

This new tech simply isn't prepped for very high volume. 

That makes sense.

[Mira Yurizaki]

13 minutes ago, Coaxialgamer said:

The problem isn't the fabs. Globalfoundries still has quite a bit of capacity left, even considering their other customers. 

It's yields. Probably not on the actual gpus if i had to guess. Likely to be on the side of the hbm2 suppliers. 

This new tech simply isn't prepped for very high volume. 

I think there's also a lot more riding on an HBM based chip than a regular one. On top of the HBM stacks, you have to make sure the interposer is also defect free and everyone's probably not happily glued together with solder you can just reflow and plop off if the final assembly is defective.

[ravenshrike]

6 hours ago, JoostinOnline said:

There isn't really a supply issue, except the one AMD has created.  You can easily buy a Vega card as a bundle.  They are restricting the number of cards that are sold individually.  It would be incredibly simple for them to make the cards available to everyone.

The idea that the bundle cards wouldn't sell out within 24 hours if dropped to regular price is absurd.

[Coaxialgamer]

7 minutes ago, M.Yurizaki said:

I think there's also a lot more riding on an HBM based chip than a regular one. On top of the HBM stacks, you have to make sure the interposer is also defect free and everyone's probably not happily glued together with solder you can just reflow and plop off if the final assembly is defective. 

From what I've gathered, it seems the most complicated part are the TSV's linking the memory stacks between each other and the interposer. 

The interposer itself, while large, contains no logic, and the gpu size is not unheard of either. 

 

You can test most of those components seperately though, which helps. 

I just think samsung and hynix can't get enough of these chips to amd, either because of manufacturing, or because they have people willing to pay a premium, and amd gets the scraps. 

[JoostinOnline]

1 minute ago, ravenshrike said:

The idea that the bundle cards wouldn't sell out within 24 hours if dropped to regular price is absurd.

That's probably an exaggeration, but you should check two posts below

[Mira Yurizaki]

3 minutes ago, Coaxialgamer said:

From what I've gathered, it seems the most complicated part are the TSV's linking the memory stacks between each other and the interposer. 

The interposer itself, while large, contains no logic, and the gpu size is not unheard of either. 

 

You can test most of those components seperately though, which helps. 

I just think samsung and hynix can't get enough of these chips to amd, either because of manufacturing, or because they have people willing to pay a premium, and amd gets the scraps. 

You still have to glue everything together and make sure that process didn't break anything. And it's still one more step in the process that could break. If a completed chip is unrecoverable, then that makes it worse.

[Maxxtraxx]

6 hours ago, JoostinOnline said:

Well with this they had a reason with some validity.  Supposedly, they were worried that miners would buy them all up (that's what happened with the RX 500 series), which is why they introduced bundles.

The problem with calling bundles a good way to keep miners from buying vega cards is that the same goal can be accomplished by limiting the number of cards purchasable by an individual household on a vendor by vendor basis, it isn't a perfect solution

 

BUT... it doesn't FORCE a prospective Gamer who wants the card to pay $100 extra if he/she doesn't want the included games or to wait around trying to buy the individual card when it restocks for 2 hours before selling out again at a vendor.

 

IMO AMD has been pretty sketchy in their claims that they will "restock" the individual cards, and sounds more like they will provide LIMITED quantities of the individual cards.

 

Looking at all the evidence from AMD's Statements, Gamers Nexus's cost analysis of the card and the limited stand alone card stock vs availability bundle stock makes me lean more towards AMD breaking even or losing money on the cards and the bundles are a way to recoup just a bit more cash.

 

5 hours ago, Jito463 said:

One possible reason would be gamer market share.  If miners buy up all the cards, then Nvidia will still have a near stranglehold on the gamer market, allowing them to practically dictate the state of gaming cards moving forward.  If AMD wants to have some say in the future of gaming on PC, they need to regain that consumer market share, which can't be done if no one can buy their cards for gaming.

What I said above still stands... but if AMD wants a future in gaming then their future cards need to follow the RX 400/500 series cards and not repeat vega... the goal of which is to produce a better performance per dollar card than Nvidia. However, what they did was produce a card that:

 

1: has a silicon die the size of a 1080Ti that provides the gaming performance of a 1080

2: A: uses the most expensive and production limited memory available

2: B: needs the additional cost of a delicate interposer that also requires the GPU package to be shipped to multiple locations/countries for full assembly(it goes from GloFo(not sure where their 14nm foundry is) to Korea for HBM and interposer assembly then gets applied to the board)

3: uses a board with DOUBLE (I believe) the number of power phases as a 1080Ti (again more parts/stuff)

4: they're 1.5 years late to the game for this level of performance, that being that top level performance only carries a premium for so long

 

as a result, they can't hit the better price to performance ratio that rx400/500 was able to hit because they're late to the game, have an unreasonably expensive card, have very limited production capability.

 

[Sakkura]

2 minutes ago, Maxxtraxx said:

The problem with calling bundles a good way to keep miners from buying vega cards is that the same goal can be accomplished by limiting the number of cards purchasable by an individual household on a vendor by vendor basis, it isn't a perfect solution

The system AMD chose was aimed at preventing wholesalers from evading limits like that.

 

Here is a good explanation of what seems to have been going on behind the scenes.

[mr moose]

Whether AMD did something with pricing or not, it seems their stock is selling out regardless.  It doesn't matter if there is a point to be made, it won't make a difference to anyone.

[Maxxtraxx]

9 minutes ago, Sakkura said:

The system AMD chose was aimed at preventing wholesalers from evading limits like that.

 

Here is a good explanation of what seems to have been going on behind the scenes.

What I took away from that post is that a wholesaler is forced to buy the Packs to receive X number of stand alone cards to "prevent" mining co-ops from buying bulk stand alone cards and preserve stock for end users.

 

A question that I ask is, what is the pack to stand alone ratio, bases upon stand alone availability it FEELS like there were more packs offered than stand alone cards(but this is likely a piece of info we'll never know), and AMD's intent would be revealed by that ratio. IF the packs to stand alone ratio is 2:1 or worse then I feel like AMD is trying to force additional margin into the product by artificially inflating the price (and in the process alienating many card buyers by ruining the price/performance ratio), IF the ratio is more favorable to the stand alone card then I would agree that it was done more to deter wholesale co-ops with the idea to see how gamers reacted to the packs being sold at a higher price.

 

IMO, it feels (very subjective) to me like AMD is doing the former.

 

What this ends up doing is forcing the end user to pay an extra $100 for the card that includes stuff they may not want and thusly prices a 64 out of the competitive market and increases margin for AMD on the sales of the packs.

 

[LukaH]

so far i heard that:

1. AMD drove up the price

2. Miners are to blame

3. Hollywood is buying all the cards

4. Retailers are messing up

5. another one

 

 

 

[ltguy]

13 hours ago, mr moose said:

Whether AMD did something with pricing or not, it seems their stock is selling out regardless.  It doesn't matter if there is a point to be made, it won't make a difference to anyone.

I keep hearing this, but its just not true. Vega 64 has been in stock, the card by itself, at newegg all week. The card is priced at $700usd and its not selling.

[PlayStation 2]

amd_rn: "You are fake news"

[Agosto]

14 minutes ago, ltguy said:

I keep hearing this, but its just not true. Vega 64 has been in stock, the card by itself, at newegg all week. The card is priced at $700usd and its not selling.

I seriously can't tell why it's happening... /s


BTW, has anyone already posted this somewhere in the forum?

https://np.reddit.com/r/hardware/comments/6vp1b1/retailers_are_buying_amd_rx_vega_64_at_675_each/dm20et2/

tl;dr: AMD supposedly sells Vega to retailers at the "right price" only if they also buy X packs for every standalone card

[Coaxialgamer]

3 minutes ago, Agost said:

I seriously can't tell why it's happening... /s


BTW, has anyone already posted this somewhere in the forum?

https://np.reddit.com/r/hardware/comments/6vp1b1/retailers_are_buying_amd_rx_vega_64_at_675_each/dm20et2/

Nope. I was actually surprised, because the earliest reports of this dated back a day before i posted this ( you'd think vega news would be posted asap). I checked the gpu and news section and couldn't find anything. 

[LAwLz]

19 minutes ago, Agost said:

I seriously can't tell why it's happening... /s


BTW, has anyone already posted this somewhere in the forum?

https://np.reddit.com/r/hardware/comments/6vp1b1/retailers_are_buying_amd_rx_vega_64_at_675_each/dm20et2/

tl;dr: AMD supposedly sells Vega to retailers at the "right price" only if they also buy X packs for every standalone card

Oh look, some reddit post from a user who is constantly attacking Nvidia and defending AMD claims to have inside information which just so happens makes AMD seem like the good guys, and retailers/miners seem like the bad guys.

What a surprise, right?

 

I mean, who wouldn't trust someone who said Vega would perform better than a 1080, and cost 400 dollars.

A person who said that he had already sold his current GPU and since he was heavily invested in FreeSync he would be ordering a Vega.

A person who, once benchmarks for the Vega FE were released, parroted the same bullshit things about "it's the drivers! It doesn't have tile based rasterization" and all the other things he probably doesn't understand the first things about, just to keep the engine in the hype train going for a bit longer.

 

I think it is sad that people just leech onto any positive comments they can find on Reddit. It's as if all you need to do on Reddit these days is to claim to have insider information, write a really long post that is positive towards AMD, and then it will get reposted over and over and over again until people become certain that it is true.

[Agosto]

7 minutes ago, LAwLz said:

Oh look, some reddit post from a user who is constantly attacking Nvidia and defending AMD claims to have inside information which just so happens makes AMD seem like the good guys, and retailers/miners seem like the bad guys.

What a surprise, right?

Wow, strong bias here

He claims AMD is selling at "normal" price only if retailers also buy packs, it's not making them look like "the good guys"

Moreover, it's pretty obvious AMD itself has not so much to do with bulk sales to miners, since they don't directly produce cards. Makes much more sense that AIBs and big retailers did so.

 

[Notional]

22 hours ago, PCGuy_5960 said:

AMD really needs to solve the supply issues, so that the cards can be available at the MSRP.

I doubt they can do much. The bottleneck is called HBM2, and the fact that the manufacturers (SK Hynix + Samsung) seems to have issues manufacturing them.

They also have no influence on actual prices at retailers. Not only do they not sell them directly to the retailers (the vendors like Asus, MSI, etc. do), but they can't dictate prices either, as that would break cartel laws in most countries.

Mining sucks, HBM2 sucks and the resulting supply and prices suck.