“Original prices on the Radeon 5700 series were a trap for Nvidia”

AMD has had an eventful summer, where both the Ryzen 3000 series and the Navi family’s graphics card in the Radeon 5700 series were launched at the same time. In the graphics card market, it is noticeable not least on Nvidia, which was out early with a counterattack in the form of Geforce RTX 2070 Super and 2060 Super.

In an interview with Hothardware, however, Scott Herkelman, vice president and department head of the Radeon division, reveals that this was expected. According to Herkelman, AMD went further than that, and put fictitious prices on the company’s upcoming graphics card so that Nvidia’s pricing would be at the top.

We know that they [Nvidia] have a tremendous burden on their gross margins, because their die size is big, and so we just game-played suggested retail prices.

Therefore, AMD changed the previously announced prices only two days before the release of the Radeon RX 5700 XT and RX 5700, which made the price level significantly more competitive. Furthermore, Herkelman believes that Nvidia’s large circuit sizes in the Turing series make it more difficult for the company to lower prices as margins take a beating.

The comparison is somewhat lame as AMD uses significantly more transistor-dense 7 nanometers, while Nvidia bases its graphics cards on an updated 16-nanometer technology called 12 nanometers. This thus provides different conditions and different prices per square millimeter, even though both are manufactured at TSMC.

Regardless, the Navi 10 circuit in the Radeon RX 5700 XT is 251 mm² large, while in terms of performance similar to the Nvidia Geforce RTX 2060 Super qualifies for a full 445 mm². The latter, however, devotes a considerable amount of circuit space ray tracing-specific functions.

In the future, AMD may launch the budget-oriented Radeon RX 5600 series, while custom coolers are expected in August for the Radeon RX 5700 series. It remains to be seen whether AMD will use the smaller circuit area to its advantage, and whether it could lead to a price war in the future.

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