If it Ain’t Broke...

The status quo is a dangerous thing. In 2005 ATI and NVIDIA were both sitting on a formula that worked: build the fastest GPU in the world (and provide solid drivers), and you’d win the market. By this point ATI had years of support to continue building GPUs this way, but there were a few within the company who believed it was time for a change.

In many ways ATI and NVIDIA were just taking different risks. NVIDIA had learned its lesson with transitioning to new manufacturing processes too quickly and would most likely build GT200 on an older, more mature process, burdening it with a huge die. ATI opted to do what NVIDIA wouldn’t and move to new manufacturing processes quicker, aiding it in producing GPUs with smaller dies.

With its only competitor hell bent on making bigger and bigger GPUs, ATI took care of half of the problem - it would be free to do whatever it’d like, without any real competition. The question then became - could it work?

It’s easy to, today, look back and say “of course” but you have to understand that this was 2005 and the first specifications of RV770 were being drafted. Imagine sitting at a table full of people whose jobs were supported by building the biggest GPUs in the world and suggesting that perhaps we sit this round out. Let NVIDIA take the crown, let them have the halo part, we’ll compete in the $200 - $300 market. Yeah, right.

What followed were heated debates, if ATI were to stake the future of its graphics business on not building the absolute faster GPU, but rather a GPU targeted at a lower market segment the proposition was risky.

ATI viewed the graphics market as five segments: Enthusiast, Performance, Balance, Mainstream and Value. In the Spring of 2005, ATI decided to shoot for the Performance segment, and not Enthusiast. You could even argue that the Performance segment is what the R300 competed in back in 2002, priced at $399 it was closer to the $299 MSRP of the Radeon HD 4870 than the $599 MSRP of the GeForce GTX 280 when it launched. But ATI viewed this as a change in strategy, while R300 aimed for performance regardless of die size, RV770 would have clear power and die size limits imposed on it.

There were many individuals at ATI that were responsible for the RV770 we know today getting green lighted. ATI’s Rick Bergman was willing to put himself and his career on the line, because if this didn’t work, he’d be one to blame. Carrell recalled a story where Rick Bergman and others were at a table discussing RV770; Rick turned to Matt Skynner and asked him if he thought they could really do it, if they could make RV770 a smaller-than-NVIDIA GPU and still be successful, if it was possible to create a halo in the Performance segment. Matt apparently pondered the question, turned to Rick and said “I think we can”. Carrell felt that ATI might not have gone down that path if it weren’t for Matt Skynner’s support and Rick Bergman making sure that the project was executed as well as it ended up being.

It was far from rosy at that point however, there were many very smart engineers, people who were responsible for things like R300 and R580 who disagreed with the strategy. People who had been right before were saying that if ATI didn’t build a true competitor to GT200 that the fight would be over. Then you had folks like Carrell saying that it could be done, that this was absolutely the right move. It’s much like the passion of politics, each side believed that they were right, but ultimately you can only pick one - and both sides have to live under the same roof.

The Bet, Would NVIDIA Take It? The Power Paradigm
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  • yourwhiteshadow - Thursday, December 04, 2008 - link

    absolutely brilliant. i've always read anandtech instead of tomshardware because of objective reviews. i was reading an intel review, and people were questioning the objectivity of anandtech. while some might could look at this as praising ATI/AMD, i would definitely say this was a very objective view of what happened. seriously, one of the BEST articles i've read since the 4850/4870 review. Reply
  • kevyeoh - Thursday, December 04, 2008 - link

    I've been reading anandtech for years and there wasn't any article that makes me wanna read every single word of it. Usually i will read the forewords and then skip on to the Conclusion. But for this article, i really read every single words! period! Anandtech rocks! Reply
  • nitemareglitch - Thursday, December 04, 2008 - link

    I was actually getting a little bored with the articles around here, until I read this one. Great job, I loved reading this story!! Reply
  • lchyi - Thursday, December 04, 2008 - link

    This is by far the best (and most insightful) article I have read here to date Anand. It sounds like you put in a ton of thought to it and I have never flown through 7,500 words as quick as that read. Congrats to the ATI guys for their successful gamble on the RV770. The last three years must have been an extremely interesting experience for them and their engineers. Reply
  • joshjnm - Thursday, December 04, 2008 - link

    Great article I will bandwagon with the rest of you and agree this is one of the best articles I've read in a while.

    Reply
  • josh6079 - Thursday, December 04, 2008 - link

    I thoroughly enjoyed the article. Last time I was really involved with graphics cards was when the X1900's were in full swing and G80 was on everyone's mind. The history told in the article helped bring me up to pace as to what has transpired since I stopped gaming as much. I can remember how the Video card section used to be here on the forums with the trolls and constant flames. Two camps of people cheered on for one or the other competitors instead of realizing that they should be cheering for competition itself.

    Great job ATI, Nvidia - what's next?
    Reply
  • Seikent - Thursday, December 04, 2008 - link

    Very good article, most of these interesting background stories are written in books, but a lot of years latter.

    Something, that is not mentioned, is that it seems that AMD didn't affect ATI in any way (technically speaking). Many thought that the R600 failure had something to do with AMD.
    Reply
  • BSMonitor - Thursday, December 04, 2008 - link

    Awesome article.

    I am definately a performance/mainstream kinda guy in this market. Definately love the competition. I started my first build with a Geforce 4200Ti, moved up to the infamous 9700Pro, followed by X1900, and now 4850HD...

    It is good to see that the ATI/AMD didn't damage ATI as a whole. Rock on guys! Love those cheap kick ass Crossfire cards! Go 4850HD x2.
    Reply
  • dmer - Thursday, December 04, 2008 - link

    as a long time reader of anand I never felt the need to register an account; however, after reading your article I felt compelled to create an account just to commend you on an excellent article.

    we need more articles that give us insight into business decisions like this. job well done mate!
    Reply
  • johnkwright - Thursday, December 04, 2008 - link

    Anand,

    I've been a long time reader of AnandTech but I especially liked this article. It was interesting to get a peek behind the curtain to see what challenges companies face when making these tough decisions. Hopefully more companies take a chance and share more of their stories with this site. Keep up the good work.

    Regards,
    John Wright
    Reply

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