NVIDIA Comes Out Swinging With The GTX 980 Ti

By Markets Fool.com

Advanced Micro Devices has confirmed that it will finally be announcing its new slate of graphics cards on June 16. Rival NVIDIA has had the high-end GPU market mostly to itself since launching the GTX 970 and GTX 980 last September at aggressive prices.

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Just a couple of weeks before AMD's event, and just a couple of months after launching the powerful GTX Titan X, NVIDIA has once again disrupted the market with the GTX 980 Ti. The $649 graphics card is nearly as fast as the $999 Titan X, and it's capable of playing games at a 4K resolution. AMD's task of winning back market share just became more difficult.

A look at the GTX 980 Ti
The eventual launch of a Ti variant of the GTX 980 was inevitable, but it is surprising that it came so soon after the launch of the Titan X. It's also surprising how close in performance the 980 Ti comes to the Titan X. While the 980 Ti sports about 8% fewer CUDA cores and texture units, and cuts the Titan X's 12GB of memory in half, real-world performance is very similar for both cards. Anandtech did a full review, and its conclusion was that there is only a 3% difference in performance between the two cards, despite the Titan X being priced $350 higher.

Source: NVIDIA

NVIDIA has essentially made the Titan X irrelevant, a bizarre move on the surface. But with AMD's new graphics cards on the way, NVIDIA likely wanted to be proactive. Instead of allowing AMD to launch a new high-end card at a lower price than the Titan X before launching a response, NVIDIA has come out swinging with the 980 Ti, putting pressure on AMD.

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AMD has a problem
There has been no shortage of rumors regarding AMD's upcoming graphics cards over the past few months. What we know is that the highest-end GPUs will sport high-bandwidth-memory, or HBM, which should give AMD's cards an advantage at the highest of resolutions. What we don't know is how much this new memory technology will add to the price of AMD's cards, or how it will ultimately perform compared to the new 980 Ti.

Some unofficial benchmarks of AMD's new high-end cards have leaked, showing that AMD's top new product performs about the same as the Titan X and the 980 Ti. That sounds about right, although we'll have to wait for official benchmarks to know for sure.

If AMD's highest-end GPU is in the same ballpark as the 980 Ti in terms of performance, the company is going to be unable to charge much more than $650. Previous rumors put the launch price of AMD's highest-end card at $899, which would likely be a non-starter given the 980 Ti's price, so my guess is that the card will ultimately launch at a lower price.

AMD is playing catch up to NVIDIA, and that puts the company in a difficult situation. NVIDIA has run away with the discrete GPU market in recent quarters, accounting for 76% of shipments during the fourth quarter of 2014, and AMD is going to have to blow away potential customers with its new products in order to win much of that market share back. Simply matching NVIDIA on performance is unlikely to turn things around for the company.

NVIDIA's strategy makes sense
While essentially making the Titan X obsolete with the launch of the 980 Ti, NVIDIA has managed to back AMD into a corner. While NVIDIA had the freedom to sell a $1,000 high-end graphics card for months without any real competition, AMD has a hard limit on how much it can charge, assuming that the performance of its flagship card is similar to that of the 980 Ti.

We'll soon find out if AMD has any tricks up its sleeve, or if the company's adoption of HBM gives it an advantage. But at the moment, NVIDIA appears to be in control.

The article NVIDIA Comes Out Swinging With The GTX 980 Ti originally appeared on Fool.com.

Timothy Green owns shares of Nvidia. The Motley Fool recommends Apple and Nvidia. The Motley Fool owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.