The Beginning: The Shot Heard Around the World

It all started back in 2001 when ATI, independent at the time, was working on the R300 GPU (Radeon 9700 Pro). If you were following the industry at all back then, you’d never forget the R300. NVIDIA was steadily gaining steam and nothing ATI could do was enough to dethrone the king. The original Radeon was a nice attempt but poor drivers and no real performance advantage kept NVIDIA customers loyal. The Radeon 8500 wasn’t good at all; there was just no beating NVIDIA’s GeForce4, the Ti 4200 did well in the mainstream market and the Ti 4600 was king of the high end.

While ATI was taking punches with the original Radeon and Radeon 8500, internally the company decided that in order to win the market - it had to win the halo. If ATI could produce the fastest GPU, it would get the brand recognition and loyalty necessary to not only sell those high end GPUs but also lower end models at cheaper price points. The GPU would hit the high end first, but within the next 6 - 12 months we’d see derivatives for lower market segments. One important takeaway is that at this point, the high end of the market was $399 - keep that in mind.

With everyone at ATI thinking that they had to make the fastest GPU in the world in order to beat NVIDIA, the successor to the Radeon 8500 was going to be a big GPU. The Radeon 8500 was built on a 0.15-micron manufacturing process and had around 60M transistors; R300 was going to be built on the same process, but with 110M transistors - nearly twice that of the 8500 without a die shrink.

Its competition, the GeForce4 was still only a 63M transistor chip and even NVIDIA didn’t dare to build something so big on the 150nm node, the GF4 successor would wait for 130nm.

We all know how the story unfolded from here. The R300 was eventually branded the ATI Radeon 9700 Pro and mopped the floor with the GeForce4. What Intel did to AMD with Conroe, ATI did to NVIDIA with R300 - back in 2002.

The success with R300 solidified ATI’s strategy: in order to beat NVIDIA, it had to keep pushing the envelope for chip size. Each subsequent GPU would have to be bigger and faster at the high end. Begun these GPU wars had.

Index Re-evaluating Strategy, Creating the RV770 in 2005
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  • DerekWilson - Thursday, December 4, 2008 - link

    I'm glad you guys were able to stick to the plan an launch at the amazing prices you hit. It really shook up the industry and helped bring higher performance to lower price points. Now we just need the same thing to happen with integrated graphics.

    But seriously ... about those future architectures ... maybe you guys want to sit down and have another nice long chat? ;-)
    Reply
  • tygrus - Thursday, December 4, 2008 - link

    Choice A : Spend another 1B on a larger chip R&D, fab problems, low yields, high unit cost, potential delays, large dual-slot with space&cooling problems. Loose mid-range revenue potential, more R&D/time etc. to make half-size chip for mid-range.

    Choice B : Make the design to be price/power/performance efficient for very profitable mass-market. If you users want almost double the performance, buy 2 identical cards which saves on not producing a low volume BIG chip/card. (Though now we have 2 chips for X2 which still simplifies and reasonable efficient compared to a card design cramming a single BIG chip starved of bandwidth).
    Reply
  • CloudFire - Thursday, December 4, 2008 - link

    hands down one of the best, if not the best article i've ever read at anand. GREAT JOB! it shows how believing and getting back up when you're being beat down can get you where you want to be!

    for those people who took up the challenge to be different and change, imo are the true innovators who changes the world in the face of extreme adversity.
    Reply
  • Emperor88 - Thursday, December 4, 2008 - link

    Great artilce. There are precious few of these.

    Thanks a lot :)
    Reply
  • cowofdoom - Thursday, December 4, 2008 - link

    Long time reader, first time poster. Great article. I really think it says it all. Any time you get a chance to write articles like this I would love to see them. Great job. Reply
  • Emperor88 - Thursday, December 4, 2008 - link

    haha first time (wait second now) poster here as well. Best article I've read here. Reply
  • Barack Obama - Thursday, December 4, 2008 - link

    Keep it comin'! Reply
  • Boundless - Wednesday, December 3, 2008 - link

    Very nice article once again...helps reinforce my decision of keeping this place readily bookmarked since I first visited back in 2001. Reply
  • Regs - Wednesday, December 3, 2008 - link

    I want to know what AMD was thinking for those quite 3 years when they blew Prescott out of the water. Did they see Conroe coming? I think it's time for Anand to get on some black paint and go commando over there at AMD HQ. Reply
  • Cloudie - Wednesday, December 3, 2008 - link

    One of the best articles I've ever read. Kudos to Anand, and thanks to AMD (: Reply

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