I find it hard to believe that in 2019, AMD wasn’t able to accurately forecast the demand for their products. I mean, it’s a VERY mature industry with relatively steady demand. It’s not like there was a sudden influx of PC users in 2019 or anything.
Now maybe there’s some fundamental manufacturing bottleneck or materials issue that’s causing this, but I’m inclined to believe that this is as much a marketing strategy as anything else. Think about it this way- if they had all the cards they could sell, they’d sell them, but they’d get zero buzz about it elsewhere. But if they intentionally constrain the supply, they’ll STILL sell the same number eventually, but in the meantime, they get social media posts, industry articles and reviews about these cool new chips that everyone wants, but few can get. And then you get articles about that as well- why are they so cool? Why are people willing to pay $1000 in the secondary market? And so on… That’s basically free marketing, AND it keeps focus on AMD, not Intel or NVIDIA. It’s a pretty smart strategy really.
Yes. It’s a characteristic of micro-processor and GPU production.
Now, there may well be logistics problems this time around – there are already logistics problems in the delivery of high-end laptops – but production of complex semi-conductor wafers always starts small with many rejects, and if the process works correctly ramps up to full production. If as sometimes happens, the fabrication process can’t be corrected, then production never meets demand.
No, I find this very implausible. AMD is in a position of superiority over Intel in terms of hardware for the first time in like 15 years. This is their big chance to hammer Intel and get market share. There’s no way they’re intentionally limiting their supply to generate buzz. Their buzz is already huge - being the first chance to get a non-intel chip that’s the best general purpose/gaming chip in almost two decades. There’s no way they’re trying to restrict supply.
Similarly with their video cards. Lots of people are upgrading right now, and the radeon 6800 series and nvidia 3080 series are in direct competition. If one of them were more widely available, the sales would go way up just because it was the one new card they could actually buy. There’s no way both companies are both restricting themselves when they could bury their competitor by having a high amount of supply now.
Same deal with xbox/ps5. There’s no way either of them are holding back on their supply as people are deciding which system to go with. They’d be giving the market to their competitor.
It’s not easy to ramp semiconductor manufacturing up and down. Designs are targeted to a specific fab–it’s not like some injection-molded toy that can be made in a thousand different factories. The fabs basically run 24/7 and you have to negotiate your share in advance. Sometimes, other customers (namely, Apple) will be prioritized higher and you just get what’s left over. It might not be enough.
Each production line requires a separate mask set. These are very expensive, and you would never buy them to handle your surge capacity, only your expected long-term production rate.
You can stockpile chips in advance, but then you push back your release date and possibly lose mindshare (especially if a competitor is coming out at roughly the same time).
Ideally, all this stuff only affects the first few months of production. After a while, both demand and supply reach a steady state which matches predictions. There just isn’t a good way to handle the initial surge for popular products.
In addition, there is a long time between a wafer start and a packaged part, in the order of months. It took a very long time to get our first production of a new processor after the start. (We had very high end stuff.) So you don’t want to underestimate demand very much, since it will take a long time to recover.
And @Melbourne is quite correct about yield ramps. That is one of the things I worked on. You may need to keep the initial price low enough for the initial demand to be high enough to justify a yield ramp effort.
I also wouldn’t be surprised if consumers anchor on the initial price which would be included with reviews of a new product, and not notice price decreases coming later which won’t get the same coverage.
I was surprised when a few weeks ago, a Sony executive commented “everything is sold.” That makes it sound like they’re not making more anytime soon. Can anyone explain why he would talk like that? Do they make a huge batch, then stop making them for a month while they sell that batch off, before they start making a new batch? I would think there would be a factory churning them out minute-by-minute, every day.
My guess is that it’s a combination of what parts they can get and what sort of production run they can predict for the foreseeable future. Surely given enough time there will be enough units made, but as time progresses and more software comes out and more people play on their friends’ systems, the demand for the product will go up as well, such that their projections are saying that they will never in the foreseeable future be able to keep up with demand. But a large part of that is that it’s difficult to predict what sort of output they are going to be capable of given the pandemic situation; they simply know that the units that they know they can produce right now are already sold.
While I’m going to guess there might be enough reservations filed with retailers to meet that supply output, I assume the suit at Sony was only talking about the people that they sell the units directly to. Those distributors know that they can move as much as they are going to be allocated any time soon, even if they don’t have specific orders for them.