Because efficient design on small dies brings prices down and sales up (if competition is there of course) which is good for end-user.

How could they say after 7 months that ATi HD 4850 is a competition for nVidia 8800 GT
According to the preliminary reults we've seen 4850 should outperform 8800GTS 512 or *perhaps* even GTX260...and that's different price tag.
BTW 8800GT wasn't a competitor to 3870 for 2-3 months after release due to lack of availability and high prices.