Looks like ATi may be foobar-ing their lead.

[BoardBonobo]

ATI, Nvidia supply not meeting demand - ATI’s performance lead may not gain it market share
Charles Chou, Taipei; Christy Lee, DigiTimes.com [Tuesday 22 April 2003]


Taiwanese graphics card makers report that high-end graphics chips from Nvidia and ATI Technologies continue to be in short supply even as the market enters its slow season. In addition, the graphics chip designers are said to be prioritizing OEM orders.

Limited supply of Nvidia’s GeForce FX 5800 (NV30) and GeForce FX 5600 (NV31) series chips has pushed some demand to ATI, card makers said. However, a shortage of ATI’s Radeon 9700 and Radeon 9500 chips has been reported and output of its new-generation Radeon 9800 (R350) series has also failed to meet demand.

Sources said that with ATI shipping products first to OEM customers like IBM, NEC, Dell Computer and Hewlett-Packard (HP), its more own-brand-oriented add-in board (AIB) clients, such as Gigabyte Technology, CP Technology and Info-Tek Corporation (ITC) (selling under the brand name GigaCube), are able to obtain only 50% of the chips they ordered.

Despite ATI’s coming out on top in recent performance comparisons, the supply problem will likely cost it the opportunity to grab market share from Nvidia, card makers said

Source

 

[Dave Baumann]

Slightly daft statement from the board vendors since OEM sales are where the volume is. ATI has had slim pickings with desktop OEM's over the past few years - its not really surprising they are capitalising on their R300 series OEM success by prioritising the OEM's first. they stand to increase their share much easier via OEM's than retail AIB's.

 

[Tahir2]

Unfortunately for the Retail level customer this will keep prices high for the forseeable future, but it will help ATi keep their ASP's at the kind of level they would want. Marketshare will come but I think ATi needs to realise that mindshare is very important too!

 

[Pete]

Now that ATi has two separate chips for high and mid-end, it seems they may alleviate the supply problem partially, no? They're no longer squeezing the same orange two ways.

 

[chavvdarrr]

Today I heard that since 1.05 R300 won't be manufactured in TSMC fabs ...

 

[MuFu]

Today I heard that since 1.05 R300 won't be manufactured in TSMC fabs ...

Really?

MuFu.

 

[Dave Baumann]

It was my understanding that R300 would continue for a little while and ATI would continue 9700 class products.

 

[Pete]

OMG, Mu & Dave, can you two be any more cryptic?

 

[chavvdarrr]

If we assume that time between start-of-chip-production and final card is ~ 3 months ....

 

[MuFu]

OMG, Mu & Dave, can you two be any more cryptic?

Oh I don't have a frickin' clue what is going on these days. chavvdarrr's statement just caught my eye ("1.05 R300" - is that a fab-migrated R300?). I don't think R390 is being fabbed at TSMC either. If it were, then I suspect we'd have heard about a tapeout from certain individuals by now.

MuFu.

 

[Mariner]

"1.05 R300" - is that a fab-migrated R300?

I read that as indicating that from 1st May, TSMC won't be producing any more R300 chips.

Whether this means that they are moving over entirely to R350 or ATI are getting another fab to manufacture R300, is a different matter. And one about the answer of which I have no idea.

 

[MuFu]

"1.05 R300" - is that a fab-migrated R300?

I read that as indicating that from 1st May, TSMC won't be producing any more R300 chips.

Umm... oops.

MuFu.

 

[BRiT]

I dont see why everyone is so hyped about this... To me it makes sense. Why continue to produce older less popular chips? The fab has switched over to R350 and RV350 chips.

 

[Mariner]

That would depend on yields, I'd guess. If they are getting yields as good or better than R300 for R350, then a straight swap would be ideal.

On the other hand, if the yields are considerably worse, it might be worth producing R300s until any problems are sorted out.

Seeing as how the R350 is little more than a modified R300, I'd guess the former. 8)

 

[YeuEmMaiMai]

considering the size of the r3X0 compared to r2X0 chips that alone would cut yeilds right in half..... 60 million transistors vs ~= 110 million

edit I wish I could spell

 

[Joe DeFuria]

Slightly daft statement from the board vendors since OEM sales are where the volume is.

Right.

Just because ATI may not be able to gain significant add-in-card market share, doesn't mean they aren't gaining in overall GPU marketshare, which is what matters to ATI.

Sounds like the OEMs are just crying about being second tier customers.

Of course, when the tables are turned and there is enough supply or even over supply...the AIB makers will be complaining about "low margins" for their products.

 

[Sabastian]

Well, first off I don't think that this shortage is a matter of good yields @ TSMC. I think that this may very well be a matter of good inventory management decisions. What I think the situation is about is that ATi wants to make sure that there is strong demand before building any sort of inventory that may or may not be sold depending on demand. This is a key reason they are able to go on to next gen tech with less expenses. Clearly ATi are experiencing a stronger demand and the orders to TSMC are being put in. The lack of inventory for a product launch IMO is a smart move. Consider that Nvidia still has demand (according to their CEO) for a variety of products, ATi wants to make sure that end user demand is there before they run off and spend a fortune building an inventory ... that is just smart considering their position.

Due to the failure of the NV30 and now the cheat on the NV35 along with a wide variety of current nvidia driver woes I do think ATi is at a critical point to gain wider acceptance with OEM customers. On that same note I believe that Nvidia is about to experience a drop in demand quite possibly across their entire lineup. There really is no denying that ATi had made vast improvements in their driver support and their latest hardware is really second to none in shipping hardware. I don't understand how it is that Nvidia can manage to hold onto their market share given ATi is beating them in all price/performance points with better hardware..... except in the chipset realm.(for which ATi will be releasing a chipset for in the near future.)