How does ATi/Nvidia make money off their cards? - Overclock.net

A Russian :D · 07-14-08

I've always wanted to know. ok so Ati makes the 770 core which costs about $50 to make then add all the other parts VDDR3 and other stuff so about $75 or so $. then they ship it to companies like VisionTek to out their own coolers on but they buy it from AMD for like $125? then sell it to newegg? how does it work?

savagebunny · 07-14-08

All I know they make money off it, I wonder this also...

**The Duke** · 07-14-08

ATI and nVidia make the GPU, unsure who makes the cards PCB but all the other stuff is bought and assembled my the various makers.

A Russian :D · 07-14-08

Quote:

Originally Posted by The Duke

ATI and nVidia make the GPU, unsure who makes the cards PCB but all the other stuff is bought and assembled my the various makers.

oh so ATi or TSMC i should say make the core and companies like VisionTek assembly the PCB and but thier cooler logo and sell it

but how does Ati make money if TSMC makes the core

h33b · 07-14-08

ATi buys the chip from TSMC (if that is who makes the chip) for a price, and then turns around and sells it to other companies for more than what they paid for it. The card companies then turn around and sell the entire card for money, but have to pay subsidies to ATi for every card they sell. At least, that's how I think it works.

DuckieHo · 07-14-08

For NVIDIA.....

NVIDIA designs and gets the GPUs manufactured by fabs. NVIDIA also negotiates and purchase loads of RAM. NVIDIA then gives their partners the Bill of Material and reference design. NVIDIA then sells the GPU+RAM to their partners. The partners then have the cards built and sell them.

**alexgheseger** · 07-14-08

Quote:

Originally Posted by A Russian :D

oh so ATi or TSMC i should say make the core and companies like VisionTek assembly the PCB and but thier cooler logo and sell it

but how does Ati make money if TSMC makes the core

They contract TSMC to make their cores, which they then sell to the AIB (add-in-board) partners. The AIB partners then assemble the PCB in their own fab facilities, either to the reference design, or to their own, special design.

Does that help?

*Chozart* · 07-14-08

AMD holds the patents, licences, etc. TSMC is merely a subcontractor. Visiontek, Sapphire, etc. purchase the cores from AMD (and not from TSMC).

The price for which ATI sells the cores, memory and other relevant hardware to the card manufacturers is profitable. Making a PCB and cooling solutiuon isn't the most expensive of things either, and esp. when they base it of AMD's reference, no real complicated designing is involved.

The margins aren't very wide, since the 48xx's are priced very competitively. The main goal right now isn't profit, but market share. Build market share, and profit will follow with the next generation (slightly more expensive) cards. Note that the 4870X2 will probably be much more profitable, since the expense in making the card isn't much higher, and a bunch of the R&D will have been earned back by the 4850 and 4870 by the time the X2 hits the markets.

A Russian :D · 07-14-08

Quote:

Originally Posted by DuckieHo

For NVIDIA.....

NVIDIA designs and gets the GPUs manufactured by fabs. NVIDIA also negotiates and purchase loads of RAM. NVIDIA then gives their partners the Bill of Material and reference design. NVIDIA then sells the GPU+RAM to their partners. The partners then have the cards built and sell them.

oh so they kind of give the companies the blueprints but they give them 2 pieces to start with the core and VDDR. i wonder how much 1GB of VDDR5 costs

vs 512 bit bus

THX GUYS + REP

A Russian :D · 07-14-08

Quote:

Originally Posted by Chozart

AMD holds the patents, licences, etc. TSMC is merely a subcontractor. Visiontek, Sapphire, etc. purchase the cores from AMD (and not from TSMC).

The price for which ATI sells the cores, memory and other relevant hardware to the card manufacturers is profitable. Making a PCB and cooling solutiuon isn't the most expensive of things either, and esp. when they base it of AMD's reference, no real complicated designing is involved.

The margins aren't very wide, since the 48xx's are priced very competitively. The main goal right now isn't profit, but market share. Build market share, and profit will follow with the next generation (slightly more expensive) cards. Note that the 4870X2 will probably be much more profitable, since the expense in making the card isn't much higher, and a bunch of the R&D will have been earned back by the 4850 and 4870 by the time the X2 hits the markets.

so AMD buys from TSMC, then other companies buy from AMD, then they sell it

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How does ATi/Nvidia make money off their cards?

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