Nvidia, AMD accused of conspiracy to keep graphics pricing high

Discussion in 'Graphics and Semiconductor Industry' started by Techno+, Dec 8, 2006.

  1. ben6

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    The thing is the high end really subsidizes the low-end of the market doesn't it? Neither NVIDIA nor ATI force anyone to buy $500+ video card. That's why they release highly competitive and high performing $200-300 cards as well. Does the DOJ want to stifle the investment technology companies put into their new architectures? And btw, if a card doesn't sell at a particular price point, what does NV or ATI do? They either discontinue the card quickly (x700 Pro anyone or 5800) or lower the price (Geforce 7800GS, ATI X1900GTO I think).

    The market dictates where the prices go I think. If there is no demand for a product at a given price point the company takes measures to alleviate the problem
     
  2. dobwal

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    Me, personally, I am praying that this to be true and that this situation leads to sub $400.00 flagship cards. LOL

    However, I find that price fixing in the discrete GPU market would be one of the stupidest and short sighted strategic moves in the history of the industry. Price fixing negatively affect ATI/Nvida in several areas.

    Price fixing promotes limited potential for market growth by:

    1. Price fixing magnifies the perception that PC gaming requires huge and constant investment. Thus, pushing consumers toward consoles away from PC gaming.

    2. The profit generation from price fixing benefits Nvida's and ATI's but creates a stagnant market for the PC developers and publishers who support is paramount to the GPU manufacturers. Thus, further pushing developers toward the console market where profit potential is greater
     
    #22 dobwal, Dec 12, 2006
    Last edited by a moderator: Dec 12, 2006
  3. nutball

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    Since when has buying high-end cards been compulsory? High-end cards cost what they do because "high-end" gamers have, generation after generation, proven themselves willing to pay whatever it takes to have the best. That's the fault of the gamers, not the IHVs. Stop paying the money, they'll stop charging the prices.

    Where I do wonder if there's a case to be answered might be in the mid-range, but even then that's often cyclical. Sometimes you get cracking deals, other times you get ripped a new one. Depends on the state of the technology at the time. An expensive high-end does open up lots of intermediate price points which can be filled with weirdly and wonderfully named and numeralled products.

    Seems to me that in a duopoly situation it's not really a surprise that prices end up roughly the same, even without a conspiracy.

    So all in all this sounds like a legal fishing expedition to me. At least the lawyers will make some money out of it.
     
  4. dobwal

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    First, let me interate that I have no belief of whether or not Nvidia/ATI is guilty of price fixing, only that I pray its true (LOL). Nor, I'm angry at Nvidia/ATI for the price of their highend card. I just would love to see sub $400.00 flagship cards.

    Second, I don't understand your post, since your point puts the fault of high prices on the shoulders of consumers and my point is that price fixing in a niche market is a faulty strategy that promotes limited growth.
     
  5. nutball

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    The basic gist of my post was pontification, I don't have a strong view either way whether there's been price fixing going on.

    My point about the high-end market is that it seems to hold people transfixed out of all proportion to the size of that market. Any talk of price fixing seems to naturally focus eyes at the $500+ price bracket, but why? [Anyway my response was probably a knee-jerk misreaction on my part to your wording ... sorry for that!]

    As for limiting market growth of PC gaming then yes you're probably right that it doesn't help, but I don't think that the cost of graphics cards is the only factor here. Intel/AMD want their slice of the price of a PC too, so they're just as guilty. But even then I don't think it's all about cost, there are other issues, eg. form-factor, typical situations and use-cases for PCs and so on.

    Given that ATI and NVIDIA are providing the graphics IP for the next-gen consoles then they seem to be in something of a win-win situation regardless of which platform the gamers end up playing on.
     
  6. dobwal

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    I concur and I did exactly what you described about becoming focused on the highend.
     
  7. DemoCoder

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    ATI and NVIDIA are engaged in a cuttthroat battle for the performance crown, using cutting edge processes, with cutting edge RAM, pushing the limits of large dies, with lower yields, and speed binning the rest, it's no wonder that the prices of the flagship cards are so high. It would be like accusing car manufacturers that sell Formula 1 and family sedans of "price gouging" on the high end.

    The surest way to kill off aggressive competition at the top is to hit the industry with a stupid ignorant lawsuit that doesn't allow companies to recoup costs on high end parts after spending a half-billion dollars on R&D.
     
  8. Geo

    Geo Mostly Harmless
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    I find it highly unlikely that this would be a high-end thing, if it were even occurring. That "always $500" thing doesn't match my memory of the last several years in the least, for one thing.

    ATI's rotten chipset margins would suggest it wasn't happening in the bottom either. They had what they felt was a superior part last year and absolutely zero pricing power to move the price point that the OEM market was used to paying.

    However, having said that, I think it unlikely DOJ just woke up one morning and decided to do this. There must have been a trigger, and some prima facie showing that looked plausible enough to justify opening an investigation for further analysis.
     
  9. Arun

    Arun Unknown.
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    Arguably, excluding one-time R&D, they're just making $5 or so per console sold (because it's a royalty scheme), while they make a lot more than that in terms of profit even on a 7300GT, most likely. Of course, it's better than nothing...


    Uttar
     
  10. Razor1

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    Wasn't the R&D taken care of by MS for the 360's case and Sony for PS3's case?
     
  11. Jawed

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    http://www.theinquirer.net/gb/inquirer/news/2008/07/16/nvidia-amd-accused-price-fixing

    Jawed
     
  12. 3dilettante

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    Wow, that's taken a while to resurface.
     
  13. Geo

    Geo Mostly Harmless
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    The quoted part of the email doesn't seem to support the judges comments. Unless he was talking about a different email or a part not quoted.

    The part quoted isn't price fixing. It's more or less proposing a trade association to raise public awarness of what video cards are, what they do, and why'd you want a better one. That kind of trade association comprised of competitors happens all the time.
     
  14. digitalwanderer

    digitalwanderer Dangerously Mirthful
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    The graphs in that .pdf are LOL worthy, IMHO.
     
  15. Geo

    Geo Mostly Harmless
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    Umm, what .pdf?
     
  16. digitalwanderer

    digitalwanderer Dangerously Mirthful
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    Oh snap! Sorry G, I was talking about a PDF you can pick up from this thread over at Tech Power Up.

    Be warned, the thread I linked to is a stereotypical example of how the internets can make you stupid. :???:

    Again my apologies, I'm usually better about references....this dog watching gig has got me all messed up. :oops:

    These are the graphs I'm talking about btw:

    [​IMG]
    1. Riva128 ($199, 9/1997) & 3D Rage II ($149,
    1/12/1998)
    2. Riva TNT 16MB ($170, 3/23/1998) & Rage
    Fury ($229, 2/26/1999)
    3. Riva TNT2 Ultra ($230, 3/15/1999) & Rage
    Fury Pro ($149, 8/5/1999)
    4. GeForce256 DDR ($300, 8/31/1999) &
    Radeon DDR ($399, 7/17/2000)
    5. GeForce2 MX400 ($115, 3/6/2001) &
    Radeon 7500 ($199, 8/27/2001)
    6. GeForce3 ($499, 2/27/2001) & Radeon
    8500 ($399, 8/14/2001)
    7. GeForce4 Ti4400 ($267, 3/18/2002) &
    Radeon 8500 ($399, 8/14/2001)
    8. GeForce3 Ti500 128MB ($399, 10/1/2001)
    & Radeon 9000 Pro 128MB ($149,
    7/22/2002)
    9. GeForce3 Ti500 64MB ($349, 10/1/2001) &
    Radeon 9000 Pro 64MB ($129, 7/22/2002)
    10. GeForce3 Ti200 ($199, 10/1/2001) &
    Radeon 9000 ($109, 7/22/2002)
    11. GeForce FX 5800 ($399, 5/2003) & Radeon
    9800 ($399, 5/5/2003)
    12. GeForce 5600 ($200, 4/2003) & Radeon 9600
    ($200, 4/2003)
    13. GeForce 6800 Ultra ($499, 4/14/2004) & Radeon
    X800 XT PE ($499, 5/4/2004)
    14. GeForce 6800 GT ($399, 5/4/2004) & Radeon
    X800 Pro ($399, 5/4/2004)
    15. GeForce 6600 GT ($199, 8/12/2004) & Radeon
    X600 XT ($199, 9/21/2004)
    16. GeForce 6200 GT ($140, 7/2005) & Radeon
    9550 ($140, 4/2005)
    17. GeForce 6800 GT ($299, 9/2005) & Radeon
    X800 XL CrossFire ($299, 9/2005)
    18. GeForce 6800 ($199, 9/2005) & Radeon X800
    CrossFire ($199, 9/2005)
    19. GeForce 7600GT 256MB ($175, 5/5/2006) &
    Radeon X1600 256MB ($175, 4/24/2006)
    20. GeForce 7950 GT ($269.99, 9/14/2006) &
    Radeon X1950 Pro ($269.99, 10/17/2006)
    21. GeForce 7900 GS ($200, 9/6/2006) & Radeon
    X1650 Pro ($199, 9/15/2006)
    22. GeForce 8800 GTX ($599, 11/8/2006) & Radeon
    HD 2900 XT ($399, 5/14/2007)

    [​IMG]
    1. Riva128 ($199, 9/1997) & 3D Rage II ($149,
    1/12/1998)
    2. Riva TNT 16MB ($170, 3/23/1998) & Rage
    Fury ($229, 2/26/1999)
    3. Riva TNT2 Ultra ($230, 3/15/1999) & Rage
    Fury Pro ($149, 8/5/1999)
    4. GeForce256 DDR ($300, 8/31/1999) &
    Radeon DDR ($399, 7/17/2000)
    5. GeForce2 MX400 ($115, 3/6/2001) &
    Radeon 7500 ($199, 8/27/2001)
    6. GeForce3 ($499, 2/27/2001) & Radeon
    8500 ($399, 8/14/2001)
    7. GeForce4 Ti4400 ($267, 3/18/2002) &
    Radeon 8500 ($399, 8/14/2001)
    8. GeForce3 Ti500 128MB ($399, 10/1/2001)
    & Radeon 9000 Pro 128MB ($149,
    7/22/2002)
    9. GeForce3 Ti500 64MB ($349, 10/1/2001) &
    Radeon 9000 Pro 64MB ($129, 7/22/2002)
    10. GeForce3 Ti200 ($199, 10/1/2001) &
    Radeon 9000 ($109, 7/22/2002)
    11. GeForce FX 5800 ($399, 5/2003) & Radeon
    9800 ($399, 5/5/2003)
    12. GeForce 5600 ($200, 4/2003) & Radeon 9600
    ($200, 4/2003)
    13. GeForce 6800 Ultra ($499, 4/14/2004) & Radeon
    X800 XT PE ($499, 5/4/2004)
    14. GeForce 6800 GT ($399, 5/4/2004) & Radeon
    X800 Pro ($399, 5/4/2004)
    15. GeForce 6600 GT ($199, 8/12/2004) & Radeon
    X600 XT ($199, 9/21/2004)
    16. GeForce 6200 GT ($140, 7/2005) & Radeon
    9550 ($140, 4/2005)
    17. GeForce 6800 GT ($299, 9/2005) & Radeon
    X800 XL CrossFire ($299, 9/2005)
    18. GeForce 6800 ($199, 9/2005) & Radeon X800
    CrossFire ($199, 9/2005)
    19. GeForce 7600GT 256MB ($175, 5/5/2006) &
    Radeon X1600 256MB ($175, 4/24/2006)
    20. GeForce 7950 GT ($269.99, 9/14/2006) &
    Radeon X1950 Pro ($269.99, 10/17/2006)
    21. GeForce 7900 GS ($200, 9/6/2006) & Radeon
    X1650 Pro ($199, 9/15/2006)
    22. GeForce 8800 GTX ($599, 11/8/2006) & Radeon
    HD 2900 XT ($399, 5/14/2007)

    Apology for the formatting of the card infos, but I got 'em off page 15 & 16 of the PDF and I'm lazy about formatting at 3:30am. I just found some of their card match-ups ridiculous.
     
  17. dizietsma

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    Out of interest how does a cpu and motherboard complexity compare to a gpu and PCB ? You can obviously pick up a cpu and motherboard for a lot less than a $650, oops $499, video card.
     
  18. 3dilettante

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    There are a number of factors beyond that.
    A slightly more fair comparison would be a CPU+MB+RAM purchase.
    Even more fair, we'd have to compare prices for products that are similarly positioned at the same ranges in their respective arenas.
    The enthusiast high-end boards and extreme edition CPUs are also highly priced.
     
  19. Arun

    Arun Unknown.
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    "11. GeForce FX 5800 ($399, 5/2003) & Radeon 9800 ($399, 5/5/2003)" - Comparable? Bwahahah, what a joke this entire thing is indeed. That's some extreme massaging of the data: nearly everything from that comparison is patently absurd. And I wonder why it stops at G80/R600 - oh wait, I know that one... *shrugs*
     
  20. Arty

    Arty KEPLER
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    It doesnt just stop there Arun, the idiocy gets worse. The pre-conspiracy comparison are often between skus in different years while in the conspiracy zone they tend to stick their comparisons to the same year ..

    That aside, those emails do have a definite stink about them. :|
     
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