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Should NVIDIA Worry about AMD’s Radeon RX Vega GPUs?

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Aug. 10 2017, Updated 8:06 a.m. ET

AMD’s Radeon RX Vega versus NVIDIA’s GTX 1080

In the previous part of the series, we saw that NVIDIA (NVDA) and Advanced Micro Devices (AMD) launched their next-generation GPU (graphics processing unit) architecture almost at the same time. AMD’s Vega GPUs received quite a bit of hype as they mark the company’s entry in the high-end GPU market owned 100% by NVIDIA.

AMD launched its Radeon RX Vega GPU line at the SIGGRAPH conference on July 30, 2017. The Vega GPU line includes three GPU models:

  • air-cooled Radeon RX Vega 56, which is priced at $399 and competes with NVIDIA’s GTX 1070 priced at $379
  • air-cooled Radeon RX Vega 64, which is priced at $499 and competes with NVIDIA’s GTX 1080 priced at $499
  • liquid-cooled Radeon RX Vega 64, which is is available in a bundle

The above three cards feature 8 GB (gigabyte) of HBM2 (high-bandwidth memory), which offers 60% more memory bandwidth than the GDDR5 found in NVIDIA’s high-end gaming GPUs—GTX 1080, 1080 Ti, Titan X, and Titan XP.

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Could AMD’s Vega gain market share from NVIDIA? 

The early performance test shows that AMD’s Vega may not be as power-efficient as NVIDIA’s Pascal-based GTX 1080. However, AMD is looking to gain market share from NVIDIA by offering competitive price-to-performance, the key metric used by gamers and developers while making buying decisions.

AMD adopted a similar technique with its Ryzen CPUs (central processing units). Ryzen CPUs do not compete with Intel’s (INTC) CPUs in terms of performance. However, they deliver better price-to-performance, which means better performance at lower cost.

AMD’s price-to-performance strategy has made its GPUs popular among cryptocurrency miners who are looking to boost processing power at the lowest cost. Even if RX Vega is not competitive with NVIDIA’s GTX 1080 in terms of performance, it would still generate strong sales among gamers who are currently facing GPU shortage as cryptocurrency miners absorb the entire GPU inventory.

To discourage miners from taking away Vega from gamers, AMD adopted a strategy to bundle products to make GPUs cheaper for gamers and more expensive for miners. It launched three Radeon Packs:

  • The Radeon Red Pack includes Radeon RX Vega 56 and is priced at $499.
  • The Radeon Black Pack includes Radeon RX Vega 64 and is priced at $599.
  • The Radeon Aqua Pack includes liquid-cooled Radeon RX Vega 64 and is priced at $699.

However, NVIDIA could give strong competition to AMD’s Vega when it launches its Volta gaming GPU in September 2017 or 1H18. NVIDIA would continue to be the preferred choice among gaming enthusiasts.

In the meantime, NVIDIA is focusing its GPUs toward artificial intelligence and autonomous vehicles. It has partnered with Baidu (BIDU) to accelerate its AI efforts. We’ll look into this in the next part.

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