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Why don't AMD make more graphics cards instead of pushing up prices?

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  • Graphics Cards
  • AMD
  • Graphics
Last response: in Graphics & Displays
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January 8, 2014 4:16:39 AM

Hi guys

Thanks to the crypto-currency craze, demand for AMD GPU's have shot up, and as a result, so have their prices. But I'm curious, did they not see it coming? And why don't they just beef up production if there is a shortage? Isn't it better for them to sell more, less expensive cards? It would also give them a better name if they owned all the cards with the best price/performance ratio.

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Anonymous
January 8, 2014 4:20:40 AM

They're selling all of the expensive ones they can make. Why would they lower the prices as long as they can do that?
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a b U Graphics card
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January 8, 2014 4:23:42 AM

Supply and demand, supply and demand. I'm willing to bet there's just not a lot of people buying the Rx series, since it's name is confusing to those not into the technical know how and probably because they're most rebrandings, so anyone with say, a Radeon HD 7850, and is looking at the same price range probably isn't looking for an R9 270X.
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January 8, 2014 4:23:45 AM

Anonymous said:
They're selling all of the expensive ones they can make. Why would they lower the prices as long as they can do that?


I've heard people say that Sapphire etc are running out of stock repeatedly. Unless they don't have the capability of providing more units to Sapphire etc, I see that as a really bad thing.
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a c 182 U Graphics card
a c 144 À AMD
January 8, 2014 4:24:02 AM

This is not a simple answer.

To understand this is a lot of business terminology involved, not to mention you need to understand how the graphics card industry works.
if you REALLY want to know, please tell me.

In the meantime. In short, AMD ONLY makes the GPU / chip portion of the graphics card, the physical card, fans, circuitry and everything is made by manufacturers like Asus, MSI or similar.

Something to consider is that how should the manufacturers have known that digital currency would have an all time high?
They purely go on supply vs demand, if there is a sudden spike, the supply is usually increased, but not by much due to a hundred logistics factors, like for example, they can not double their workforce overnight.

Keep in mind that making a graphics card is a VERY long process. Much longer than most people recognize.
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a b U Graphics card
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January 8, 2014 4:25:54 AM

I am ready to learn, Novuake. Drop some knowledge on me. No essay is too long.
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January 8, 2014 4:28:11 AM

Deus Gladiorum said:
I am ready to learn, Novuake. Drop some knowledge on me. No essay is too long.


Yeah let us know, I gobble anything tech related :ange: 
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January 8, 2014 4:37:18 AM

Novuake said:
This is not a simple answer.

To understand this is a lot of business terminology involved, not to mention you need to understand how the graphics card industry works.
if you REALLY want to know, please tell me.

In the meantime. In short, AMD ONLY makes the GPU / chip portion of the graphics card, the physical card, fans, circuitry and everything is made by manufacturers like Asus, MSI or similar.

Something to consider is that how should the manufacturers have known that digital currency would have an all time high?
They purely go on supply vs demand, if there is a sudden spike, the supply is usually increased, but not by much due to a hundred logistics factors, like for example, they can not double their workforce overnight.

Keep in mind that making a graphics card is a VERY long process. Much longer than most people recognize.


Yes please do!
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a c 182 U Graphics card
a c 144 À AMD
January 8, 2014 4:57:38 AM

Very well then. I will probably miss a few things until asked. So feel free...
Just from a technical point of view for now.

I am gonna number bullet this :

How the GPU industry works :

1. The GPU or chip :

This is the internal brain of the graphics card that is VERY similar in many ways to a CPU. most notably the differences that most people can understand is core count. Think of the GPU as many tiny single cores that work separately on different parts of the image that you see on your monitor.
Here is a video that outlines the making of a silicon wafer (multiple chips) at Globalfoundries, they make all AMD chips.
http://www.youtube.com/watch?v=qm67wbB5GmI

This process takes up to a month for CPUs, newer tech has dropped that time, but not by much.

2. The board partners or manufacturers :

These include companies like Asus, MSI, XFX, Sapphire and many more.
These companies basically make a deal with AMD for the actual GPU chip, with this deal they receive a certain amount of chips in certain timeframe including the reference design (on paper blueprints mostly) that AMD has built for this chip.
The reference design look like this for example : http://wccftech.com/wp-content/uploads/2013/09/AMD-Rade...

This reference design is then effectively studied and reverse engineered by the board partners.
They then use their own designed or purchased components like PCB(green board part), VRMs (voltage regulators), coolers and other circuits to complete a design of the card.
The board is then built and the chip from AMD is added to the finished card.
Board partners even modify the "software" or firmware of the cards from AMD initial design to get different clock speeds.
Non-reference example : http://www.techpowerup.com/img/12-03-15/167a.jpg


So now since you understand that, to get the supply increased that means that the manufacturers need to change a longstanding contract with AMD, then AMD has to go and suddenly increase the amount of chips made by Globalfoundries makes for them, which is another longstanding and a lot more volatile and BILLIONS of dollars contract.
So that is 2 major groups that need to suddenly increase production.

Then even if all of this is done, a chip takes a month to make.

Makes sense?
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a b U Graphics card
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January 8, 2014 5:10:30 AM

Makes plenty of sense, but then I have a few technical questions. I knew that GPUs were essentially processors packaged onto their own motherboard, i.e. the actual chip soldered into a PCB, but then my question is, why is there even a need for a PCB with a GPU? Is it just to provide a connection to the cooler and PCIe connection?
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a c 182 U Graphics card
a c 144 À AMD
January 8, 2014 5:12:53 AM

Deus Gladiorum said:
Makes plenty of sense, but then I have a few technical questions. I knew that GPUs were essentially processors packaged onto their own motherboard, i.e. the actual chip soldered into a PCB, but then my question is, why is there even a need for a PCB with a GPU? Is it just to provide a connection to the cooler and PCIe connection?


Pretty much, and to have space for the VRAM, VRMs, BIOS chip and plethora of other small components.
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a b U Graphics card
a b À AMD
January 8, 2014 5:14:36 AM

Oh, duh. I forgot about VRAM and the BIOS chip. Speaking of which, how does one access a GPU BIOS? I've never explored it, nor do I recall seeing an option for one in my main UEFI.
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a c 182 U Graphics card
a c 144 À AMD
January 8, 2014 5:16:57 AM

Deus Gladiorum said:
Oh, duh. I forgot about VRAM and the BIOS chip. Speaking of which, how does one access a GPU BIOS? I've never explored it, nor do I recall seeing an option for one in my main UEFI.


You can not access it. Its actually a very simple thing all done in hard coding.
There is no format to actually view it in as you would with a normal BIOS.

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a b U Graphics card
January 8, 2014 5:17:52 AM

what about flashing it to a more recent version?
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a c 182 U Graphics card
a c 144 À AMD
January 8, 2014 5:21:54 AM

cst1992 said:
what about flashing it to a more recent version?


Pointless and dangerous in most cases.

Newer firmware on a GPU rarely improves much.

Its an unneeded risk unless you have money to burn.
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January 8, 2014 5:25:23 AM

Thanks Novuake, makes a lot of sense :) .

EDIT: Do you know this by researching or practical experience?
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a c 182 U Graphics card
a c 144 À AMD
January 8, 2014 5:26:49 AM

Razor88 said:
Thanks Novuake, makes a lot of sense :) .

EDIT: Do you know this by researching or practical experience?


A bit of both. :) 

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a b U Graphics card
a b À AMD
January 8, 2014 5:35:06 AM

One other question; the manufacturing process of CPUs is often measured, i.e. 32 nm manufacturing process or 22 nm, etc. I'm assuming that this is the distance between circuits, right? Also, I often hear that the smaller the process, the better the energy efficiency. How does the size relate to energy efficiency?
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a c 199 U Graphics card
a b À AMD
January 8, 2014 5:38:25 AM

For something a complex as a microelectronic device ramping up production takes time as each link in the supply chain has to increase production to match increased demand.
Large supply contracts will be signed months or even years ahead of commencement and manufacturers schedule production accordingly: From the main chips themselves to the tiny screws holding the GPU cooler down, all must arrive at the right place, at the right time and in the right quantity or the whole chain halts.
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a c 182 U Graphics card
a c 144 À AMD
January 8, 2014 5:43:09 AM

Deus Gladiorum said:
One other question; the manufacturing process of CPUs is often measured, i.e. 32 nm manufacturing process or 22 nm, etc. I'm assuming that this is the distance between circuits, right? Also, I often hear that the smaller the process, the better the energy efficiency. How does the size relate to energy efficiency?


22nm is the average HALF-distance between 2 components or transistors of the same type.

Energy is always lost when being conducted through something.
By bringing the core components closer together, the actual distance that useless conductivity needs to take place is reduced.

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a b U Graphics card
a b À AMD
January 8, 2014 6:20:05 AM

Who knew I could learn so much from a bronie? Where'd you learn such info?
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a b U Graphics card
January 8, 2014 6:29:50 AM

Deus Gladiorum said:
Who knew I could learn so much from a bronie? Where'd you learn such info?


It's just an avatar dude.
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a c 182 U Graphics card
a c 144 À AMD
January 8, 2014 6:38:19 AM

cst1992 said:
Deus Gladiorum said:
Who knew I could learn so much from a bronie? Where'd you learn such info?


It's just an avatar dude.


Its Brony with a Y. :) 

And no need to defend me, I would not have the Avatar if I took offence from it.

Anyway, got the info the same way as any knowledge is gathered, over time, alot of reading and knowledge passed on by others.
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a c 89 U Graphics card
a b À AMD
January 8, 2014 6:44:32 AM

Deus Gladiorum said:
I knew that GPUs were essentially processors packaged onto their own motherboard, i.e. the actual chip soldered into a PCB, but then my question is, why is there even a need for a PCB with a GPU? Is it just to provide a connection to the cooler and PCIe connection?

it is also about matching the different scales of connections and managing thermal expansion coefficient of the materials, this is what the chip carrier substrate does (the small board under the chip). If one were to directly solder the gpu die straight to the pcb of the card the solder joints wouldn't last a month, just a guestimate but you'll get the idea... The substrate material is also more expensive stuff than the bigger board so it is more ecomical to have this a bit more complex setup going on than to make the whole board out of the substrate material.

edited a misplaced word, dont know how that happened
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a b U Graphics card
January 8, 2014 6:56:04 AM

@OP Also think about the fact that the price at which you buy the GPU is determined mainly by the retailer, not by AMD (or any other producing company). As you might know, AMD set a price (e.g. 599$), however the have no control over the retailer and the price he uses for the product (I think).

And also the limited amount of products might as well be due to the fact that the shop under-stocked, not that the cards are not available.

As Novuake already said, there are really a lot of factors that go into this, so it makes it nearly impossible to only identify one of them as the problem.

Same thing happened to me when I bought my R9 280x Matrix.
The shop had GPU`s as available on the website, however when I ordered a Toxic they didn`t have it in stock, and offered to send me a Matrix for the price of the Toxic (60$ cheaper).
After one week, when they restocked, all cards were about 100$ more expensive, including the Mtrix, from the original price.
So, I got lucky that I bought my GPU in the exact sweet spot and got it for 160$ than the price it has now.

Also, if you`re wondering why these huge price differences, this happens in Poland...
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a c 182 U Graphics card
a c 144 À AMD
January 8, 2014 6:57:20 AM

Pr3di said:
@OP Also think about the fact that the price at which you buy the GPU is determined mainly by the retailer, not by AMD (or any other producing company). As you might know, AMD set a price (e.g. 599$), however the have no control over the retailer and the price he uses for the product (I think).

And also the limited amount of products might as well be due to the fact that the shop under-stocked, not that the cards are not available.

As Novuake already said, there are really a lot of factors that go into this, so it makes it nearly impossible to only identify one of them as the problem.

Same thing happened to me when I bought my R9 280x Matrix.
The shop had GPU`s as available on the website, however when I ordered a Toxic they didn`t have it in stock, and offered to send me a Matrix for the price of the Toxic (60$ cheaper).
After one week, when they restocked, all cards were about 100$ more expensive, including the Mtrix, from the original price.
So, I got lucky that I bought my GPU in the exact sweet spot and got it for 160$ than the price it has now.

Also, if you`re wondering why these huge price differences, this happens in Poland...


True.
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