### Introduction

Throwing hard-earned cash down for computer purchases is never an easy task. Computer hardware can be a particularly tricky purchase, considering the sheer number of revisions, designs and price points at any one time. ATI and NVIDIA have over 100 cores combined for the AGP video market on shelves today. Yet, somewhere in that haystack of video cards lies the perfect video card, equally balanced in performance and price. Finding it can be a bit of a pain though. What we have decided to do today is step away from the specific type of guide format and look at buying components on a more general basis using mathematical modeling and historical data. We aren't going to tell you which hardware to buy per se, but we will show you the same methodology that we use when determining our picks for the week. We get really theoretical for the first few introductory pages before we get into the historical data, so bear with us if we sound like a college text book for a little while.

Let us cut right to the chase. When buying computer hardware – at least with a sane perspective – there exist only two goals in mind: minimize the Price and maximize the performance. Performance can be somewhat ambiguous, so in this analysis, we will refer to performance and features as Quality. We find later that Price and Quality are both predictable, yet dynamic equations, but the most basic building blocks of any economic model for computer hardware exist as Price (P) and Quality (Q).

It is actually very easy to put a data type on Price - it's just the dollar/yen/euro amount that the component costs. Quality, Q, is a little harder to quantify in the general sense. Everyone has different computing needs, and thus, it's virtually impossible for us to put a numerical value on the performance of a processor or video card in every application – but fortunately, we have benchmarks to simulate a vast majority of real world scenarios. The most critical and difficult step when computing your next purchase cost comes when we attempt to quantify Q. Don't let the name "quality" fool you either. CPUs, for example, make it easy for us to quantify Quality in specific applications because one product is always arbitrarily faster than another. Video cards, on the other hand, make it a little harder, since we need to put a value on additional features like TV tuning or Image Quality. We will get more into these concepts on the following pages.

The million dollar question that we get asked every day, thousands of times a day is "When should I upgrade?" Actually, the questions are usually phrased like:
• "Should I wait six weeks to buy a Radeon X800 XL?"
• "Is it worth it for me to upgrade to an SLI motherboard?"
• "Should I buy more RAM?"

Finding the right time to upgrade shouldn't revolve around the next best thing or even a particular component. The right time to upgrade can usually be modeled around how Valuable additional Quality is to you. The moment when you feel your Athlon XP 1700+ has put you behind a performance curve is the most opportune moment to start calculating how valuable an upgrade is to you. However, this can actually be quantified as well, and we will get more into that in the next couple of pages.

Another thing that we stress in our Buyer's Guides and Price Guides is to look at the entire picture when upgrading and not just a single component. You may feel that your Athlon XP 1700+ is too slow and that you need a new processor, but perhaps we can achieve better performance or Quality for cheaper by upgrading the video card instead. The solution actually hinges on looking at everything in the picture and not just individual components.

On the next few pages, we are going to determine the Value and Quality of some components and determine where the best upgrade path exists. This should answer the few example questions above, but the methodology can be applied anywhere we like when buying new computer hardware.

Quantifying Price

• #### Googer - Sunday, January 30, 2005 - link

Just kidding, a very nice article. Reply
• #### Googer - Sunday, January 30, 2005 - link

they just renamed the site AnandsHardwareGuide.com Reply
• #### benk - Sunday, January 30, 2005 - link

There is a superfluous space which breaks the link for the excel sheet on page 3. Reply
• #### archcommus87 - Sunday, January 30, 2005 - link

I'm amazed that this can actually apply too much in the real world. Seems like too many numbers are fudged/made up, such as cost per day, or the quality percentages. Reply
• #### faboloso112 - Sunday, January 30, 2005 - link

it would certainly be nice to have a plug-n-chug sorta setup so we can download the app and run it and figure out what should be our next upgrade...but nonetheless...this is a very solid article...and plus im sure that making such a prog wont exactly be the easiest thing in the world. but still...if you did make such a prog you'd be helping thousands of people make a good choice when upgrading. and if not you Kristopher...maybe Anand or even an AT member could perhaps take up this little project?

once again...great article...keep up the great work!!
• #### xsilver - Sunday, January 30, 2005 - link

right on #4 -- some noobs here may read that and go "what's a model? is it much like a supermodel?" :D Reply
• #### Postoasted - Sunday, January 30, 2005 - link

The article reminded me of an econometric class I sat in on in college. For me, a click-thru decision menu would be more practical. Generally speaking, the menu would start with one's present computing environment and uses with time/cost analysis calculated for each performance unit-increase in efficiency. Reply
• #### ChrisChiasson - Sunday, January 30, 2005 - link

Some of your graphs are labeled "Price to Quality", where the GeForce 6600 has the highest series range on the entire time domain. The graphs should be labeled "Quality to Price", if the GeForce is the best upgrade.

1 to 2 = 0.5
2 to 1 = 2.0

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