Sunday, October 30th 2011

Are Improving Integrated Graphics Slowly Killing Off Discrete Graphics Cards?

Intel started the trend of improving integrated graphics with their second generation LGA1155 socket Core i3, i5 & i7 line of processors. Depending on the model, these processors sport integrated HD2000 or HD3000 graphics right on the processor die, which nowadays give acceptable performance for low-end gaming and can play Full HD 1080p video perfectly. This trend is increasing with the upcoming Ivy Bridge processors, which will be able to support a massive 4096 x 4096 pixel display, as we reported here. AMD now also have equivalent products with their Llano-based A-series processors. So, where does this leave discrete graphics cards? Well, the low end market is certainly seeing reduced sales, as there really isn't enough of a performance difference nowadays to always warrant an upgrade from an IGP. As integrated graphics improve further, one can see how this will hurt sales of higher end graphics cards too. The problem is that the bulk of the profit comes not from the top-end powerhouse graphics cards, but from the low to mid-end cards which allow these companies to remain in business, so cannibalizing sales of these products to integrated graphics could make high-end graphics cards a much more niche product and crucially, much more expensive with to boot.

Hence, it's not surprising to see that Digitimes are reporting that while NVIDIA are about to produce the next generation Kepler-based GPU's on TSMC's 28nm process and AMD have already started production of their Southern Islands-based GPU's, the graphics card manufacturers are cautious about jumping in head first with cards based on these new products. Taiwan-based card makers are watching the market before making decisions, according to Digitimes' industry sources:
Compared to the makers' eagerness for the previous-generation GPUs, graphics card makers are rather conservative about the upcoming 28nm chips due to concerns such as TSMC's weak 40nm process yield rate issues may re-occur in its 28nm process and weakening demand for graphics cards and lower-than-expected gross margins.
The poor 28nm yield rate isn't helping either:
Although previous rumors have indicated that TSMC's poor 28nm process yield rate could affect Nvidia's launch of its 28nm GPUs on schedule at the end of 2011, as TSMC already announced its 28nm process has entered mass production, Nvidia's new Kepler GPUs are expected to be announced in December.
All this of course, is bad news for PC enthusiasts, who are always looking to upgrade their PCs with the latest technology so that they can run power-intensive tasks on them, such as 3D gaming and distributed projects such as Folding@Home. On the plus side, a top-end card like a GTX 580 or HD 6970 will not be integrated into an IGP any time soon, because of the sheer power, heat and die size requirements, so there is still hope that affordable high-end cards will remain available.

What's interesting, is that as AMD are now a combined CPU & GPU company, they know full well that their IGP solutions eat into sales of their own discreet low to mid-end graphics cards. It will be worth watching AMD's strategy for dealing with this problem, closely.
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79 Comments on Are Improving Integrated Graphics Slowly Killing Off Discrete Graphics Cards?

Super XP
There will always be a market for discrete graphics at least for another 10 to 15 years IMO.
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Fishfaced Nincompoop
I have not read through the thread but in the long run I think it will. People doing rendering and other HPC stuff will still be interested in it, but I'm not sure it will be called graphic cards any more at that stage.
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For basic office users, maybe. For workstation/any mid range to enthusiast's desktops or even laptops, no freaking way.
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The Exiled Airman
What intel does haves though is resources i.e. money. A few phone calls and an email or two (yeah i know its more than that easy ) intel acquires/partners nvidia stir mix and in a few years they're stomping as usual. Its just me but i still see the ipads as toys and dont consider them for computing(gonna buy one though to see for myself) I do however realize this is where everything is headed (low power& mobile). Who know one day we might be gaming on 3D eyefinity Ipads with holographic screens :laugh:....i might need to patent that.
Only thing thats really stopping NV from releasing their own platform is an x86 license
Posted on Reply
ironic, just around a decade ago graphics calculation tried to separate itself from the CPU with the introduction of GeForce 256, the first "GPU" (tho the more programmable ones didnt came out till GeForce 3 and up). And now here we are, graphics processing is merging itself to the CPU once again (tho still on a separate chip, larrabee would have been the early ones to do CPU and GPU stuff)
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