AMD is kicking off the first quarter with some aggressive changes to its GPU roadmap, starting with the launch of a new $150 GPU this morning. The aptly-named R7 265 is sliding into the $150 bracket — and causing some significant price upheaval in the process. The “new” card itself is a rebadged 28nm GCN part — this is an R9 270, with fewer cores and a wider memory interface.

The R7 265 should be effective competition for Nvidia in the $150 price bracket, but it also comes with an added bonus: AMD’s lower-end GPUs are getting a significant price cut.

Better positioning for Bonaire

AMD’s original GCN core for the $180 price band was the mediocre Cape Verde (Radeon 7770). It compared poorly against its own predecessors and was promptly torpedoed by the GTX 650 and GTX 650 Ti. Last year, AMD snapped back with the Radeon 7790 — a significantly faster midrange card with 896 GPU cores, and (though we didn’t know it back then), support for both TrueAudio and what’s come to be called the GCN 1.1 instruction set that’s shared by the Hawaii core.

Unfortunately, AMD chose to limit their new Bonaire core to a 128-bit memory interface, which left the card vulnerable to the 192-bit interface on the GTX 650 Ti Boost. The rebranding spree last fall didn’t really change this positioning — at $140 for a 2GB card, the R7 260X was still squeezed by the GTX 650 Ti Boost. Now, with a new $150 card, the 260X is taking a $20 price cut, down to $120.

At $120, the 260X is going up against the GTX 650 and the GTX 650 Ti. It outperforms the former easily and should still be faster than the latter, which means AMD has just positioned itself as the go-to solution in this space. The downside is that the company’s product lines are now confusingly compressed: The R7 250 starts at $90, the R7 250X is $100, the R7 260 is $110, and the R7 260X is $120.

The R7 260X is 33% more expensive than the R7 250 — but it’s almost 2x as fast according to Anandtech’s database. Funneling end users towards the top of the stack is probably a good idea overall, but at $120, the R7 260X should be a really good deal for entry-level gaming.

Watch this space

These are the first significant price cuts we’ve seen from AMD in 2014, but they probably won’t be the last of the year. As we’ve previously discussed, AMD’s last update to its graphics roadmap predicted significant price cuts coming this year, with most of its core cards moving down one notch in the stack. It’s logical to conclude that the R7 265 update was sparked by the imminent launch of something else from Team Green, even if we can’t talk about that something-else just yet.

We expect to see continued competitive adjustments from AMD over the next 10 months based on this. On a related front, we’ll have a look at AMD’s Dual Graphics solution pairing the A10-7850K with a low-end R7 250 in the near future. The entry-level market is going to get very interesting in the next few weeks.