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AMD and NVIDIA will raise the price of their new GPUs for this reason

You are neither the first nor the last to think that prices have to go lower when it comes to graphics cards. The market is crazy with speculation, there are fewer and fewer excuses for those who justify the costs put by manufacturers, and if you think that the new batch with Ada Lovelace and RDNA 3 is going to solve the problem… You may be wrong. In theory, prices are going to be higher, and the reason is simple and complex at the same time: design costs. What will be the price of the RTX 40 and RX 7000?

This morning we were talking about how NVIDIA intends to cut costs against AMD with a move that Lisa Su has already made: increase the size of the caches and decrease the buses or simply keep them, but never increase them. Although this reason is valid due to obvious architectural details, there would be a second reason in the shadows and about which little is said.

The price of the RTX 40 and RX 7000 versus the cost of design

We go first with the final conclusion and then with the arguments so that it is better understood. In principle and except PS5-style surprise where NVIDIA and AMD design at a loss, the price of the RTX40 and RX7000 It will not be less than that of the current RTX 30 and RX 6000.

The reason is the design cost of TSMC’s 5nm node, which, on the other hand, will also drag Intel and Samsung in their respective versions to smaller nanometers. We think that the step of the transistors FinFET to SHGs (and its customized versions by each of the three designers) is for reasons of density and space, but although this is true it is also true for costs.

The comparative table shows a weighting, a more or less precise outline of what the different nodes in the industry cost or have cost. Keep in mind that this is top secret and you can’t be totally accurate, but IBS calculates this based on their research.

The 5nm almost doubles in costs to the 7nm

AMD-vs-INtel-vs-Nvidia

It is a trend that will continue in the market until the GAA and High-NA for EUV arrive, as well as better AI algorithms for design. What we can see is that of the current 7nm we are at with TSMC and Intel (10 in the case of the blue ones, although they are better technically speaking) the cost is almost $300 million by design, while with the new 5nm this shoots up to the 542.2 million.

That is, for each chip that NVIDIA or AMD designs, the cost will be similar to those figures, so it is not surprising that they use the same skins for as many dies as possible, since then disabling CU or SM is much simpler. and cheap.

But if this were not enough, it is estimated that for TSMC’s 3nm and Intel’s 7nm the costs are somewhere between 500 million and 1,500 million dollarsalways talking about the most advanced chips of both brands of course.

For this reason, manufacturers now take much longer to launch new products or simply launch the so-called “refried” ones: they have to optimize design costs at first and to them must be added production, distribution and other minor additions. Therefore, it is not expected that the prices of the new graphics cards will drop, rather on the contrary, it would be a miracle if they remained at similar figures to the current ones.

Mining has shown that there are people willing to pay outrageous for a GPU, we will see if when mining as such is finished and ceases to be profitable if the average gamer goes through the hoops of AMD, NVIDIA and Intel or if on the contrary it moves to consoles and leave the PC market behind.

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