The impact of Ivy Bridge on current processor pricing

We’ve shown you a lot of graphs but for those who don’t want to read through all of them we’ve summarised the key findings. On the AMD front there are quite a lot of key points to take note of:

• Dramatic price cuts on all FX 8XXX and FX 6XXX models of around 10% after the Ivy Bridge launch
• The introduction of AMD’s Cashback program of price cuts
• Recent cuts in FX 4XXX models in anticipation of Ivy Bridge i3 launches
• Overall declines in price of 30% for launch-Bulldozer models and 10% for recent Bulldozer models

There were also a lot of implications for the pricing of Intel’s Sandy Bridge CPUs after the Ivy Bridge releases:

• Stable 2700K prices
• Initial decline followed by rise in 2600K, 2550K and 2500K prices
• Stable i3 prices as Ivy Bridge i3s not ready for release just yet

It is clear that Bulldozer was not as successful as it could of been, hence why prices slowly declined after release. But when Ivy Bridge was introduced, AMD were further exposed for being power, performance and price uncompetitive hence why the 10% cuts were required to stay in the game. The AMD Cashback program has been used to boost sluggish demand for Bulldozer and now you can really pick up some bargains when it comes to Bulldozer, thanks in large part to the success of Ivy Bridge. When Ivy Bridge i3 models come out expect to see AMD FX processors forced down in price even more, particularly the FX 4XXX models. The overall trend for AMD doesn’t look too good either, in 9 months the majority of their processors have shed 30% of their value whilst in 18 months the majority of Sandy Bridge processors have shed only 5-20%.

Intel clearly recognised that with the transition to the 22nm process it was necessary to cut some prices to convince people to turn to Ivy Bridge. However, Intel’s price cuts on the popular K series Sandy Bridge processors have almost been eliminated by a surge in demand driving prices back up. As a result the impact of Ivy Bridge on long term Sandy Bridge prices has been to keep prices higher. The drop in price before the Ivy Bridge launch represents people holding out to see if Ivy Bridge was worth the wait, when people realised Ivy Bridge wasn’t that different to Sandy Bridge then Sandy Bridge prices bounced back. Intel has maintained i3 pricing as they work on readying their Ivy Bridge i3 models for launch later this year.

Advice to CPU buyers out there right now would be:

• AMD Bulldozer: Buy Now before the CashBack program runs out in late August, AMD can’t afford to lower prices any further than they already have done
• Intel Sandy Bridge i7/i5 K Series: Demand is higher than ever, buy now as prices may climb more. Don’t expect any respite until Haswell
• Intel Sandy Bridge i3: Wait for Ivy Bridge i3s to force the prices down in a few months time