Monday, August 21st 2017
AMD Issues Official Statement on RX Vega 64 Pricing Woes
Update: Related to this story, feast your eyes on Newegg's deal of the day, with a reference, standard Sapphire RX Vega 64 for $689.99 with two "free" games. I don't think I've ever seen such a conturbated launch as this. Also, considering the scope and content of the article, I will be updating the tag for this piece as an Editorial.
There has been somewhat of an uproar in recent times regarding AMD's lack of clarity on pricing of their newly-launched Vega 64. While AMD themselves told reviewers and consumers that their RX Vega graphics cards would be available for $399 (Vega 56) and $499 (Vega 64), recent events have, at the very least, cast some doubts on Vega's supposedly clean-cut pricing. Some popular reviewers and YouTubers have even gone so far as to say they won't be accepting any more samples from AMD due to a perceived slight at the erroneous information provided by the company; when someone reviews and analyses a product based on a fixed price-point advanced by a company, and then that pricing seems to have turned out nothing more than smoke and mirrors... People's work is put out the window.
Now, AMD has come out to put rumors of false Vega pricing announcements to rest. Except the skeptic in me remains, well... skeptic. Here's what AMD has said: "Radeon RX Vega 64 demand continues to exceed expectations. AMD is working closely with its partners to address this demand. Our initial launch quantities included standalone Radeon RX Vega 64 at SEP of $499, Radeon RX Vega 64 Black Packs at SEP of $599, and Radeon RX Vega 64 Aqua Packs at SEP of $699. We are working with our partners to restock all SKUs of Radeon RX Vega 64 including the standalone cards and Gamer Packs over the next few weeks, and you should expect quantities of Vega to start arriving in the coming days."
Do you agree with me when I say that AMD isn't committing to a base $499 pricing for RX Vega 64? Expressions like "limited launch quantities included standalone Radeon RX Vega 64 at SEP of $499" don't really clear the air as to when (if) such pricing will be restocked. At best, AMD seems to only be saying that they'll restock some token offerings for their RX Vega graphics cards, if nothing else, simply looking to curb doubts on RX Vega's MSRP. Yes, it does start at $499 - but there is no true availability at that pricing, because AMD only restocks limited quantities at that pricing through (apparently) rebates and other offerings to retailers. And AMD left a crystal clear sentence of "we'll be restocking Vega SKUs at the announced $499 pricing" conspicuously absent.
The issue is that multiple retailers have come out, one way or another, to say that AMD have, in fact, issued changes to the RX Vega 64's retail pricing. OC UK's Andrew Gibson (Gibbo), the source we quoted in our first story that put forward some doubts on AMD's real RX Vega pricing intentions, gave KitGuru some clarifications on his initial claims on OC UK's forums: "Launch price was $499 with NO games for the Black card, as outlined to us by AMD as a launch only price. AMD allowed us to sell a set amount at this price, which was several hundred, clearly not enough as they were sold out in approximately 15 minutes. After this the regular price was $599 with FREE games for both the black and silver cards, $699 for the aqua card plus taxes." Another retailer, this time Norwegian komplett.no, also said that AMD's RX Vega 64 stock to be sold at MSRP $499 was limited to 275, as the company was "allowed to sell at a favorable price at launch. The RX Vega 64 version we had for sale was in a limited edition of this price and will unfortunately not be put up for sale again."
OcUK's Andrew Gibson went on to say that AMD's launch price of £449 "(...) is not possible, $499 is below what they cost us direct from the board partners by a large chunk of cash, AMD rebated us to hit $499 on a set amount of units. As such $599 is now the minimum." The retailer representative also went on to say that "Unfortunately AMD did not make the launch pricing plan clear at all to the press or the consumer, which has caused a lot of confusion, if we could sell cards at £449 and make money, they'd be at that price. If that was the case we probably would have sold around 5,000 units now at OcUK, whereas the reality is we've sold a little over 1000."
Over at Gamers Nexus, Steve Burke has voiced what sources inside the retailer family have been quietly putting out: that AMD did allow retailers to sell limited quantities of the RX Vega 64 SKU at $499 through time and quantity-limited rebates so as to allow retailers to sell part of their Vega 64 cards at AMD's announced pricing. AMD's Radeon Packs have apparently seen the highest alocation of Vega graphics cards on AMD's part, because this allows the company to recoup their losses at selling RX Vega 64 - and soon, RX Vega 56 - at their announced MSRP. It seems that AMD's BOM for their monolithic, 484 mm² dies and exotic HBM2 memory (as well as R&D expenses, naturally) have increased RX Vega's manufacturing cost to the point where (sources are claiming; take this with a grain of salt) AMD loses more than $100 on each RX Vega consumer card sold. Perhaps it's only a coincidence that Vega's retailer pricing increase covers both AMD's estimated manufacturing costs, as well as retailer's margins. Perhaps not. But there has been enough smoke dotting the aftermath of Vega's rise that it's likely there is fire.
Sources:
IO Tech, via Videocardz, JayzTeoCents @ Twitter via Reddit user wickedplayer494, KitGuru, Tek.No, Gamers Nexus
There has been somewhat of an uproar in recent times regarding AMD's lack of clarity on pricing of their newly-launched Vega 64. While AMD themselves told reviewers and consumers that their RX Vega graphics cards would be available for $399 (Vega 56) and $499 (Vega 64), recent events have, at the very least, cast some doubts on Vega's supposedly clean-cut pricing. Some popular reviewers and YouTubers have even gone so far as to say they won't be accepting any more samples from AMD due to a perceived slight at the erroneous information provided by the company; when someone reviews and analyses a product based on a fixed price-point advanced by a company, and then that pricing seems to have turned out nothing more than smoke and mirrors... People's work is put out the window.
Now, AMD has come out to put rumors of false Vega pricing announcements to rest. Except the skeptic in me remains, well... skeptic. Here's what AMD has said: "Radeon RX Vega 64 demand continues to exceed expectations. AMD is working closely with its partners to address this demand. Our initial launch quantities included standalone Radeon RX Vega 64 at SEP of $499, Radeon RX Vega 64 Black Packs at SEP of $599, and Radeon RX Vega 64 Aqua Packs at SEP of $699. We are working with our partners to restock all SKUs of Radeon RX Vega 64 including the standalone cards and Gamer Packs over the next few weeks, and you should expect quantities of Vega to start arriving in the coming days."
The issue is that multiple retailers have come out, one way or another, to say that AMD have, in fact, issued changes to the RX Vega 64's retail pricing. OC UK's Andrew Gibson (Gibbo), the source we quoted in our first story that put forward some doubts on AMD's real RX Vega pricing intentions, gave KitGuru some clarifications on his initial claims on OC UK's forums: "Launch price was $499 with NO games for the Black card, as outlined to us by AMD as a launch only price. AMD allowed us to sell a set amount at this price, which was several hundred, clearly not enough as they were sold out in approximately 15 minutes. After this the regular price was $599 with FREE games for both the black and silver cards, $699 for the aqua card plus taxes." Another retailer, this time Norwegian komplett.no, also said that AMD's RX Vega 64 stock to be sold at MSRP $499 was limited to 275, as the company was "allowed to sell at a favorable price at launch. The RX Vega 64 version we had for sale was in a limited edition of this price and will unfortunately not be put up for sale again."
OcUK's Andrew Gibson went on to say that AMD's launch price of £449 "(...) is not possible, $499 is below what they cost us direct from the board partners by a large chunk of cash, AMD rebated us to hit $499 on a set amount of units. As such $599 is now the minimum." The retailer representative also went on to say that "Unfortunately AMD did not make the launch pricing plan clear at all to the press or the consumer, which has caused a lot of confusion, if we could sell cards at £449 and make money, they'd be at that price. If that was the case we probably would have sold around 5,000 units now at OcUK, whereas the reality is we've sold a little over 1000."
Over at Gamers Nexus, Steve Burke has voiced what sources inside the retailer family have been quietly putting out: that AMD did allow retailers to sell limited quantities of the RX Vega 64 SKU at $499 through time and quantity-limited rebates so as to allow retailers to sell part of their Vega 64 cards at AMD's announced pricing. AMD's Radeon Packs have apparently seen the highest alocation of Vega graphics cards on AMD's part, because this allows the company to recoup their losses at selling RX Vega 64 - and soon, RX Vega 56 - at their announced MSRP. It seems that AMD's BOM for their monolithic, 484 mm² dies and exotic HBM2 memory (as well as R&D expenses, naturally) have increased RX Vega's manufacturing cost to the point where (sources are claiming; take this with a grain of salt) AMD loses more than $100 on each RX Vega consumer card sold. Perhaps it's only a coincidence that Vega's retailer pricing increase covers both AMD's estimated manufacturing costs, as well as retailer's margins. Perhaps not. But there has been enough smoke dotting the aftermath of Vega's rise that it's likely there is fire.
153 Comments on AMD Issues Official Statement on RX Vega 64 Pricing Woes
Edit: Can we get this thread closed now? I doubt anyone can make sense of anything reading every post in here.
As far as anyone outside of OKUK, I haven't seen anything.. but I feel not many would... biting the hand that (barely) feeds you in all...but I hear where you are coming from. ;)That is a great point. However, AMD would surely not want to get caught handing out misleading pricing information (limited to launch time and small quantity) to intentionally or inadvertently skew review conclusions. They are not immune to that effect either. EVERYONE is trying to save face it feels like. ;)If that is what happened, that is perfectly normal. AIB cards come out shortly after. And when I say AIB cards, I am not talking about rebadged reference models, but the modified units.
AMD rebated those units OCUK was overcharged with and if the partner or distro is charging more that eat into his margins, Poor businessman not making enough profits.
I'm not following the rest of what you said there...sorry... You are essentially saying Gibbo oversold his $499 allocation/rebates and is bitter? That may be true, but, I dont see where Gibbo said that...(side note, a 2nd retailer said the same thing... komplett.no... as seen above)
From his statement, it seems like he had the quantity known already... "several hundred....sold out in 15 ins........ AFTER THIS the REGULAR PRICE was $599 with free games". Unless you saw him say that somewhere else, I surely can't read what you are from what we have...........
I don't know what to believe...
The second retailer says the same thing certain units were allocated for the sale, no mention of Rebates. They are not selling them anymore at that price point so market applies.
They can sell the others for profit because they aren't selling it for nothing. The rebate gave them profit on the $499 model. The $599 model has profits in there since AMD is taking the hit on the rebate/games, not the stores missing it making it possible to profit with.
Sorry, I thouht you meant 2nd store confirming the limited stock and such... but just because it wasn't mentioned, doesn't it he didn't have any. I don't understand why Gibbo would lie.......... It makes him look so bad it just doesn't make sense!!!
He spoke random BS about about how Vega has amazing mining performance.
He appears to be speaking random BS now about Vega pricing.
Andrew Gibson
Purchasing Manager / E-Commerce at Overclockers UK
Hmm , I wonder if he would have had any motives for lying about two things that would have benefited his work for Overclockers UK ... :rolleyes:
That's obviously sarcasm , to me it is somewhat clear :
He lied about mining performance to get people hyped up and buy the cards. I mean it's pretty obvious his claim was based on nothing.
He might have also lied about this whole pricing thing to make Overclockers UK look like the good guy that would never screw over customers with price gouging.
Considering these cards were going to sell out anyway due to limited availability, that removes or at least tempers their motive to do lie. I could see if there was some kind of worry, but, they are all gone man...and where within what, Hours? Same with klompett. Why would he pile on when he was sold out and knew damn well they would sell out as well???
Where did he spout BS about Vega mining? I didn't see that...link please! :)
"Andrew 'Gibbo' Gibson is suggesting the hash rate for the Vega GPU is between 70
and 100MH/s. With the RX 580 hitting about 25MH/s, and the GTX 1080 Ti offering
32MH/s, those numbers will be getting the miners all moist in the unmentionables.
And that could also mean stock gets hoovered up before any gamers can get near the
cards."
There was also a forum post if I recall corectly which I cannot find at the moment.However the reality is AMD had done a poor job in terms of marketing , they never made it clear if the card was going to be amazing in terms of performance. Also prior to launch they said they will do their best to get these cards off the hands of miners. It could be that fear might have set in that neither miners or gamers will pick them up.
He didn't do a damn thing that the article claimed he was going to do, I don't think (voucher, 1K cards, etc). I can see him speaking out of his arse and from ignorance on minig...
This didn't happen either:I see where you are coming from on that point, but at the same time, its tough to believe since hardly a damn thing was true in that article, outside of Gibbo even. Was that fudzilla or wccftech you linked? :p :roll:
But again, both those places knew darn well they were going to sell out. Even on 8/4. There wasn't remotely a need to spread FUD around intentionally. ANd truth be told, before this happened, I had no clue who that dude even was. I wonder how much pull he really has in the market... (guessing not much).
Vega is expansive to make , AMD most likely asked retailers to get these cards on shelves for prices which would have had generated too little profit. AIBs were probably in the same boat as well.
Retailers weren't happy with that , I suspect AMD also did a poor job at communicating with them about how things are.
In the end retailers had to make money somehow , so they price gouged as much as they could wherever they could while sticking with AMD's requirement to have a certain number of cards at MSRP.
Now some of them seem to have devised some excuses by profiting from the confusion.
Anyhoo, cheers! :)
The whole rebate things can sum up like this: AMD sold GPU to AIB, set MSRP at $499 -> AIBs (might have) pulled an overcharge -> Retailers complained -> AMD offered rebate to some of retailers.
So what is AMD's fault in this situation? Eventually AMD are not the ones who benefit from the overcharged price. They already received their cash after selling GPUs to AIBs.
And the AIBs also have their reason to set that higher price: People are still buying at that price. Heck, most of the inventory are cleared out even before reaching retailers, by big miners.
First, I don't hate AMD. Not in the least. I, like many others, have been waiting for a competitive part. Ryzen has changed the game on the CPU side. If you need a good performing chip and need to save some cash, grab it. If you need, or want, the best IPC and gaming performance, go Intel. Is there a big difference there? Heck no. RE: GPUs..... We have that (competitive part) with Vega 56 at $399. Heck, I'd even say to $450 there is a good reason to get the 56. So long as it performs as well as it does against the 1070, which it does. Beats it by 3% at 1080p and 6% at 2560x1440. V64 doesn't look as nice considering price, performance, and power use. Hard to hate AMD holding that opinion in my back pocket, ya know? :)Are we at that level yet? We are talking three reference models and their pricing + availability and what was told to reviewers and retailers.You've seen/heard that they are losing $100 per GPU right? Who knows if that is true, but, if margins were high, do you think ANYONE would be playing these games with prices? Can't say I buy what you are selling as is...AIB's really have nothing to do with it, yet...the price will go up even higher if all things remain the same.
I mean, I could be off my rocker... it has happened enough before... but as I said, through these eyes, also being a reviewer... how things went down just feels incredibly shady.
About the bold part, you are completely wrong. Even the reference cards are sold to retailers from one of the AIBs. You can never buy a bare AMD card, there always are some Asus, MSI, Gigabyte, etc. stickers on the cards you can buy. They have different warranty policies, in-box accessories and of course, difference prices. So, AIBs have everything to do with the price, even for a reference model.
For the miners/gamers stuff, the retailers don't even care whether their customers are gamers or not. Ultimately if the street price is to high, it's your wallet, your choice to not buy. But spreading misleading stuff is the other thing.
We can add your speculation of the AIBs jacking up the price to the pile of speculation we already have. I am not sure if I am hooked on that however, considering Gibbo mentioned AMD specifically. If the AIBs jacked the price, it stands to reason Gibbo would have outed them, no?????
There is a polished turd in speculation pile somewhere! :)
Well, maybe it can be the most polished turd in the pile so far...that said, the odd thing is we don't see AMD coming out and saying their AIBs did it either... :)
Again, my main talking point is how this 'move' from [whoever] borked review conclusions and skewed perception. Maybe the AIBs did it..
:lovetpu: