The future and consequences for ATI

R350

R350 is to ATI what NV35 is to NVIDIA – a faster version of the basic (R300) chip. At least, so the rumor mill holds. If those same rumors hold up, you can expect it to be called the Radeon 9900, since ATI is is expected to reserve the lofty ‘ten thousand’ range for their next-generation products. Just a few days ago, the Inquirer reported that ATI and TSMC are working together to make the RV350 on a 130nm process. For the confused, R350 is the big brother, RV350 is the younger sibling, like 9700/9500.

What’s really interesting about R350 is that it will continue to be manufactured with a .15 micron process, meaning that ATI will remain sheltered from any further fallout from the .13 debacle, should it occur. This does translate into slightly higher production costs based on the price of silicon, but that may be less expensive if yields remain better than at .13 micron. Of course, if R350 ramps up the clock speed too much, it may have yield problems of its own due to heat issues.

ATI’s status

ATI’s recently announced fiscal Q1 03 results were very encouraging. Revenue was up 34.5%, or almost $81 million and profits were $5.0 million, compared to a loss of $32.2 million the quarter before. Numbers also improved compared to the year before, ATI having reversed a trend towards ever-greater setbacks.

Given the current economic conditions and the brief time that its 9700 cards were on the market, this is very encouraging news for ATI. Their situation will continue to improve, at least until GeForce FX hits the market. After that, ATI will stabilize at a comfortable level, unless GeForce FX does something unexpected.

Unexpected? That’s right, there are some questions about GF FX’s performance. NVIDIA claims it is 30% faster than the Radeon 9700 Pro, although theoretically the 9700 Pro has a higher real-world fillrate since it has more memory bandwidth. Most people have taken NVIDIA’s claims with a grain of salt, calling it a bit of FUD to get the masses to wait before buying a 9700 card. Of course, if NVIDIA delivers what it claims – that would be the unexpected kink. ATI would recede on the market a bit and stabilize at a lower level than otherwise expected.