Graphic Designs

From high-end gamers to entry-level PC assemblers, graphics cards vendors are wooing the channel to create routes-to-market

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By  Andy Tillett Published  January 29, 2006

Lucrative market |~|rauf200.gif|~|Rauf Baig, managing director, Dubai office and regional sales manager Middle East and Africa at ATi.|~|Ask any reseller which component has the most scope for growth in 2006, and few will say graphic cards. Seen as either an expensive toy for gamers or simply a low margin volume product, many resellers overlook the fact that graphics is one of the fastest growing component sectors. Graphics cards have huge margin potential on high-end sales, masses of vendor support, and, with increasing strain on memory from ever more complex programmes, many more users are projected to upgrade. Graphics is the future and the smartest resellers are getting into this market now. The battle for users’ pixels easily draws parallels with the CPU and motherboard markets, in that it is very consolidated, with two major players producing the graphic processor units (GPUs) that power the cards, leaving resellers, integrators and end-users to choose one of two routes: ATi or Nvidia. These two vendors’ graphic processors are added onto actual graphic cards by other vendors and this full product is sold into the distribution channel. The reason the GPU manufacturers work like this is because of supply and demand. ATi used to produce its own graphic boards, but pulled out of the market six years ago to concentrate on GPUs. “In terms of business, the add in board partners that we tie up with can do a lot more in terms of volumes than ATi ever could,” says Rauf Baig, managing director, Dubai office and regional sales manager Middle East and Africa at ATi. Regional distributors such as Almasa and Golden Systems estimate that entry-level product account for around 80% of their overall graphics card sales. Vendor Sapphire broke its sales down as 80% entry-level cards, 15% of sales in the mid range and 5% of high-end cards. At the low end of the market there are only two questions integrators and resellers ask: Whats the price and whats the specification? At the niche, high-end market, technology is the key, and this produces an entirely different attitude. “Once we have gamers in a community we get the high-end sales. They’re the key, they don’t care about paying US$50 more for a better card, whereas at the low end buyers wont pay fifty cents more,” says Mohammed Ibrahim, managing director at Sapphire Middle East, a graphics card vendor working exclusively with ATi. ||**||

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