While we all dream of 300MHz+ GPUs with 128MB (or more) of ultra-fast DDR memory, not everyone has the disposable income to afford this. Graphics processor manufacturers know this as well. These manufacturers break the market up into three segments: value, (graphics cards below $150 – although this number has quickly faded to the $100 mark on the street) mainstream (cards around the $200 price point), and enthusiast ($250 and up).
The enthusiast market is where all the buzz and marketing takes place. Bragging rights are crucial in this segment, if you have the hottest card in this space, not only will you have a product consumer’s lust over, you’ll also have a line of enthusiasts willing to pony up the dough to get it. And while the market itself is composed of a select (read: small) group of consumers, the profit margins for these cards aren’t.
On the opposite end of the spectrum is the value segment. Profit margins here are incredibly slimmer, but at the same time the market itself is considerably larger – not only are consumers interested in saving a buck, so are tier one OEMs such as Dell and Compaq. As a result, manufacturers such as ATI and NVIDIA must play a balancing act between all three segments – slip a few too many features in a value card and the mainstream market can dry up, or the price on your enthusiast card could be so high that most consumers pass it up.
Maintaining the proper balance was traditionally obtained by slipping in newer, faster products to replace the older variant. An example of this would be 3dfx’s Voodoo2 replacing the original Voodoo Graphics card in the enthusiast segment as the Voodoo1 shifted to the value market. More recently graphics manufacturers have been releasing cores at different clock speeds – the faster cores simply cost more money. In the case of the value segment, this is also coupled with a less powerful graphics core.
It is partially because of this strategy that smaller players in the graphics field have been able to sneak their way into the value space while the big boys are focused on trumping up their products at the top. Last summer ST Microelectronics and PowerVR teamed up with Hercules (among other manufacturers) to deliver the Kyro 2. While it generated an enormous amount of fanfare when it was launched (and spurred NVIDIA price cuts) Kyro 2 ultimately was forgotten when ATI and NVIDIA refreshed their product lineups in the field.
This summer another player has arrived to duke it out in the value space: SiS’s Xabre line of graphics cores.