Monday, September 9th 2024
AMD Confirms Retreat from the Enthusiast GPU Segment, to Focus on Gaining Market-Share
AMD in an interview with Tom's Hardware, confirmed that its next generation of gaming GPUs based on the RDNA 4 graphics architecture will not target the enthusiast graphics segment. Speaking with Paul Alcorn, AMD's Computing and Graphics Business Group head Jack Huynh, said that with its next generation, AMD will focus on gaining market share in the PC gaming graphics market, which means winning price-performance battles against NVIDIA in key mainstream- and performance segments, similar to what it did with the Radeon RX 5000 series based on the original RDNA graphics architecture, and not get into the enthusiast segment that's low-margin with the kind of die-sizes at play, and move low volumes. AMD currently only holds 12% of the gaming discrete GPU market, something it sorely needs to turn around, given that its graphics IP is contemporary.
On a pointed question on whether AMD will continue to address the enthusiast GPU market, given that allocation for cutting-edge wafers are better spent on data-center GPUs, Huynh replied: "I am looking at scale, and AMD is in a different place right now. We have this debate quite a bit at AMD, right? So the question I ask is, the PlayStation 5, do you think that's hurting us? It's $499. So, I ask, is it fun to go King of the Hill? Again, I'm looking for scale. Because when we get scale, then I bring developers with us. So, my number one priority right now is to build scale, to get us to 40 to 50 percent of the market faster. Do I want to go after 10% of the TAM [Total Addressable Market] or 80%? I'm an 80% kind of guy because I don't want AMD to be the company that only people who can afford Porsches and Ferraris can buy. We want to build gaming systems for millions of users. Yes, we will have great, great, great products. But we tried that strategy [King of the Hill]—it hasn't really grown. ATI has tried this King of the Hill strategy, and the market share has kind of been...the market share. I want to build the best products at the right system price point. So, think about price point-wise; we'll have leadership."
Alcorn pressed: "Price point-wise, you have leadership, but you won't go after the flagship market?," to which Huynh replied: "One day, we may. But my priority right now is to build scale for AMD. Because without scale right now, I can't get the developers. If I tell developers, 'I'm just going for 10 percent of the market share,' they just say, 'Jack, I wish you well, but we have to go with Nvidia.' So, I have to show them a plan that says, 'Hey, we can get to 40% market share with this strategy.' Then they say, 'I'm with you now, Jack. Now I'll optimize on AMD.' Once we get that, then we can go after the top."
The exchange seems to confirm that AMD's decision to withdraw from the enthusiast segment is driven mainly by the low volumes it is seeing for the kind of engineering effort and large wafer costs spent building enthusiast-segment GPUs. The company saw great success with its Radeon RX 6800 series and RX 6900 series mainly because the RDNA 2 generation benefited from the GPU-accelerated cryptomining craze, where high-end GPUs were in demand. This demand disappeared by the time AMD rolled out its next-generation Radeon RX 7900 series powered by RDNA 3, and the lack of performance leadership compared to the GeForce RTX 4090 and RTX 4080 with ray tracing enabled, hurt the company's prospects. News of AMD focusing on the performance segment (and below), aligns with the rumors that with RDNA 4, AMD is making a concerted effort to improving its ray tracing performance, to reduce the performance impact of enabling ray tracing. This, raster performance, and efficiency, could be the company's play in gaining market share.
The grand assumption AMD is making here, is that it has a product problem, and not a distribution problem, and that with a product that strikes the right performance/Watt and performance/price equations, it will gain market-share.
Catch the full interview in the source link below.
Source:
Tom's Hardware
On a pointed question on whether AMD will continue to address the enthusiast GPU market, given that allocation for cutting-edge wafers are better spent on data-center GPUs, Huynh replied: "I am looking at scale, and AMD is in a different place right now. We have this debate quite a bit at AMD, right? So the question I ask is, the PlayStation 5, do you think that's hurting us? It's $499. So, I ask, is it fun to go King of the Hill? Again, I'm looking for scale. Because when we get scale, then I bring developers with us. So, my number one priority right now is to build scale, to get us to 40 to 50 percent of the market faster. Do I want to go after 10% of the TAM [Total Addressable Market] or 80%? I'm an 80% kind of guy because I don't want AMD to be the company that only people who can afford Porsches and Ferraris can buy. We want to build gaming systems for millions of users. Yes, we will have great, great, great products. But we tried that strategy [King of the Hill]—it hasn't really grown. ATI has tried this King of the Hill strategy, and the market share has kind of been...the market share. I want to build the best products at the right system price point. So, think about price point-wise; we'll have leadership."
The exchange seems to confirm that AMD's decision to withdraw from the enthusiast segment is driven mainly by the low volumes it is seeing for the kind of engineering effort and large wafer costs spent building enthusiast-segment GPUs. The company saw great success with its Radeon RX 6800 series and RX 6900 series mainly because the RDNA 2 generation benefited from the GPU-accelerated cryptomining craze, where high-end GPUs were in demand. This demand disappeared by the time AMD rolled out its next-generation Radeon RX 7900 series powered by RDNA 3, and the lack of performance leadership compared to the GeForce RTX 4090 and RTX 4080 with ray tracing enabled, hurt the company's prospects. News of AMD focusing on the performance segment (and below), aligns with the rumors that with RDNA 4, AMD is making a concerted effort to improving its ray tracing performance, to reduce the performance impact of enabling ray tracing. This, raster performance, and efficiency, could be the company's play in gaining market share.
The grand assumption AMD is making here, is that it has a product problem, and not a distribution problem, and that with a product that strikes the right performance/Watt and performance/price equations, it will gain market-share.
Catch the full interview in the source link below.
129 Comments on AMD Confirms Retreat from the Enthusiast GPU Segment, to Focus on Gaining Market-Share
Game bundles hardly represent value. Its just nice.
AMD will never win market share by selling game bundles either. The GPU behind it needs to be compelling, not the deal with the games.I always love these fantasy comments. 'If AMD would - (insert impossible situation)' I would buy.
Meanwhile, the vast majority instead buys Nvidia at a higher $/FPS price point regardless. I've said it before when AMD focused on 'the mid range' and left the high end behind... Nobody wants to bet on the losing team - even the AMD rep up here in this article doubly confirms it, if you want dev support you need substantial market share, luckily AMD has the consoles and 90% of PC gaming with any focus on strong graphics, is ports. You're either playing for the top position, or you're not playing, quite simply because the mid range is already a known factor. Basically by saying you focus on midrange, you're saying 'next gen, you will see more of the same shit you can already buy today, with minor tweaks'. Well wow, where can I sign up...
Prediction: AMD isn't going to sell jack shit with this strategy for RDNA4, Nvidia will simply undercut them with a better deal, they barely have to make an effort to do so.Given the average UE5 performance relative to older titles I'd be inclined to agree. There's a strong requirement and demand in the market for faster GPUs. I'm sure there is some architectural low hanging fruit for RDNA wrt Nanite and all, but yeah, I'd expect 7900XTX performance equivalent and then some if they want to keep playing. If they stall on 7900XT performance... this whole stack is DOA. Those people already bought a 4070 (S) or 4060ti at that point, or even a 7800XT.
I dont care what the vast majority buys. That's the majorities problem not mine. I can speak only about myself and what I would want.
The problem with the statement from the OP is if AMD want to push NV then they must do it NOW. Why do they drag this out? It's like... almost a decade without AMD products beating NV in $/FPS or whatever metric by a significant (5 to 10 percent don't count) margin, with only the RX 7700 XT / 4060 Ti being a non-rivalry rivalry. I don't expect anything but more of the same :(
In the era of handheld gaming there is no need for low and mid-low segment graphics card anymore.
So no, its not the offerings, is the mediocre marketing by AMD plus the bribed influencers that keep pushing Ngreedias gpu downs everyone’s throat on a daily basis.
So when someone not that technical see that, they inevitably think that all AMD gpus are absolute trash.
Hell, even more technically adept buyers are falling for it. See how everyone is ok with Ngreedias monopoly, crazy prices and anti consumer practices.
Either way, this will go on for ever since as many times before, you, like others in here, will simply laugh at my points.
In any way, this seems like a reasonable decision grounded in reality. Nvidia has the top end of the market captive because they simply can sell scraps from their main market to gamers and always come out on top, there in very little R&D required to cook something useful with scraps from the king's table.
2. 7900XTX is a good card, but let’s not kid ourselves. It can compete with a 4080/4080S. Nobody who looks at buying a 4090 and has the money for it would consider it a “compelling alternative” to one. It’s just inferior in every single metric and that is all that particular market care about, price is mostly irrelevant at that point.
I think AMD did succeed in making Nvidia do a stealth 4080 price cut, via the 4080 Super refresh.
edit: Now when I looked at other posts, this isn't a dumb move, like said on this thread, this segment is where the most consumers are.Never had any issues with my 6700 XT, the only instability has been when I was looking the lowest possible undervolt for the GPU.
But to truly gain market share, they need to cut prices hard, not just follow Nvidia pricing minus 5-10%, because that's not enough to convert people even if it's objectively better value.
Last time I checked, they started using ROCm and that has improved the software.I hate the fact that AMD used the 9 moniker, since everyone thinks that they are competing with the 4090.
That said, its stupid to ignore the fact that in many (not all) benchmarks, the 7900xtx is around 15 to 20% slower but can cost up to
100%50% less.That’s assuming best case scenario in pricing for AMD (800 in my particular case) to 2k for the 4090 (worse case for Ngreedia when msrp prices weren't available)Please read my comment again.And everyone bought…4080 Super, instead of 7900xtx.
Which bring us back to the hypocrites asking for AMD to compete. They will not buy an AMD gpu regardless of how good it is. All they want is for Ngreedia to cut prices so they would get their beloved Ngreedias gpus cheaper.
For the same die size (and yield) of a BIG consumer GPU they can produce a BIG professional product and ask for it 3-5 times more.
After all they have a limited production window (TMSC) in time and units.
Smaller die size are more productive and have higher yields: that lets them keep market share, be competitive in the console market, etc.
:p
Its officially being put in a game. Falcon engine used for it.
That’s just Durante and his PH3 experimenting with cool ideas and dabbing on the so-called AAA porting efforts as usual. Sadly, we are unlikely to see anything similar from big budget PC ports, you will eat poorly optimized blurry upscaled slop and like it.