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When the graphics chip company NVIDIA (NASDAQ: NVDA) announced its latest generation of GPU last month, the big novelty was the equipment dedicated to ray tracing. Ray tracing is a rendering technique that can produce realistic images by simulating light rays. Until now, real-time ray tracing was too computationally expensive for consumer hardware.
Beyond the bells and whistles, the other thing that stood out was the price. NVIDIA has increased the MSRP on its three new graphics cards compared to their predecessors, setting up a test of the company's pricing power. NVIDIA is trying to entice players to pay for a new feature, ray tracing, that does not exist yet in the available games.
With the third-party reviews of NVIDIA's two new high-end graphics cards, the RTX 2080 and RTX 2080 Ti, now available, it's clear that NVIDIA is taking risks with price. Performance gains in existing games are not as great as those achieved by NVIDIA's previous generation of graphics cards. For players who are not willing to pay more for the promise of games that may support ray tracing, the RTX series is not very convincing.
Image source: NVIDIA.
Faster and more expensive
The RTX 2080 and RTX 2080 Ti are both faster than their predecessors, the GTX 1080 and GTX 1080 Ti. The RTX 2080 Ti is about 32% faster for 4K games and the RTX 2080 is 35% faster. These figures, averaged over several games, come from Anandtech, which has proven itself.
These performance gains have a cost. The MSRPs of these new maps are far superior to those of their predecessors.
|
Graphic card |
Increased performance |
MSRP Increase |
|---|---|---|
|
RTX 2080 Ti |
32% |
42.9% |
|
RTX 2080 |
35% |
16.7% |
Data sources: Anandtech and NVIDIA.
With the RTX 2080 Ti, NVIDIA is charging more money than the additional warrants. The RTX 2080 looks better, although the GTX 1080 is available well below the MSRP for the moment. Using market prices, the RTX 2080 costs 45.9% more than its predecessor. The NVIDIA Founders Edition versions of these cards offer a bit more performance, but even higher price tags.
The performance increases are also much lower this time around. The GTX 1080 was about 71% faster than the GTX 980 replaced. The GTX 1080 Ti was 74% faster than the GTX 980 Ti. In terms of performance in existing games that do not use the new ray tracing features, the RTX 20 series is much less disturbing than the GTX 10 series when it launches in 2016.
In competition with himself
NVIDIA has no competition in the gaming graphics card market. Advanced micro systems"The offers are the best at RX Vega 64, last or near all Anandtech tests. The biggest competitor in the RTX 20 series is the GTX 10 series, and these old cards will probably not be available at any point in time.
Each new generation of graphics cards typically leads to increased performance per dollar. On this front, the RTX 20 series is far from its predecessor. I do not see these new cards driving the type of upgrade cycle that the GTX 10 series has driven.
Once the games that support NVIDIA's ray tracing technology begin to spread, it will become clearer whether these new cards are really worth the price. It is still unclear whether the low-end cards that will be announced will support ray tracing since they may not have the same name. These may prove to be better purchases for players seeking an upgrade and not wanting to pay a premium for ray tricks.
NVIDIA remains the only game in town for those looking for the best performance. But raising prices while offering poor performance gains in existing games makes these cards difficult to sell for those considering upgrading the GTX 10 series. This could hurt NVIDIA's game growth in the coming quarters. .
Timothy Green has no position in the mentioned actions. The Motley Fool owns shares and recommends Nvidia. Motley Fool has a disclosure policy.
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