IHS iSuppli: Integrated Graphics Chips Will Take Off In 2011

Market research firm IHS iSuppli on Wednesday issued a report forecasting that in 2011 integrated graphics processors such as Nvidia's Tegra, AMD's Fusion and Intel's Sandy Bridge chips will run inside 50 percent of notebook PCs and 45 percent of desktops worldwide.

IHS iSuppli predicted that graphics-enabled microprocessors -- chips that feature an integrated CPU and GPU on a single die -- will expand their presence in the notebook market 11 percent, from 39 percent in 2010 to 115 million units sold by year's end. The study forecasts that the market segment for integrated graphics chips -- many of which debuted inside systems at CES 2011 in January -- will grow by 9 percent in 2011, shipping inside over 63 million units globally, from 36 percent of the overall processor market last year.

"GEMs are microprocessors that feature a central processing unit (CPU) as well as a graphics processing unit in a single-chip design, supplementing the brains of a PC with more graphics capability to run visually intensive applications," Peter Lin, principal analyst for compute platforms at HIS, said in a statement. "With GEMs capable of generating the total graphic output of a PC, no additional graphics processor or add-in graphics card is needed. Computers today are serving up ever-richer multimedia experiences, so the graphics capabilities of PCs have become more important, driving the rising penetration of GEMs."

Furthermore, according to IHS iSuppli, integrated graphics will take over the majority of both traditional PC form factors -- the laptop as well as the workstation. By 2014, the study predicts, 83 percent of notebooks worldwide and 76 percent of desktops will include a CPU and a GPU on a single die. As a result, leading CPU manufacturers Intel and AMD will ramp up their already highly competitive rivalry in the processor industry, as AMD prepares five different Fusion APU platforms and Intel continues to market Sandy Bridge.

However, IHS iSuppli said that integrated graphics processors cannot be expected to provide the same level of performance as discrete GPUs, and it therefore forecasts no significant cannibalization of discrete graphics card will any time soon. High-end graphics for gaming and professional applications will continue to rely on discrete cards, the study concludes, while the majority of users, whose workloads do not require discrete-level performance will leverage integrated platforms for their functionality.

On the whole, market analyst IDC last month issued a report saying the worldwide PC microprocessor industry experienced sluggish growth in the fourth quarter of 2010. The report offered a conservative forecast for the industry in 2011 due to delays to both AMD's Llano Fusion product and rival Intel 's Sandy Bridge integrated graphics platform.

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Intel in February identified and fixed a circuit design error in its Intel 6 series chipset code-named Cougar Point, which runs alongside Sandy Bridge. As a result, several OEMs partnering with Intel briefly suspended production of systems running Intel's Sandy Bridge platform. AMD executives said customers turned to them following Intel's Sandy Bridge recall and, less than a month after the recall AMD launched a new initiative targeting its reseller partners and end user customers in order to take advantage of Intel's product delay.

David Kenyon, AMD's chief channel executive in January told CRN that the company's new Fusion integrated graphics platform offers system builders a greater variety of technical designs and business opportunities than Intel's Sandy Bridge.

Not to be forgotten, graphics specialist and chief AMD rival in the GPU space Nvidia at CES showed off its dual-core Tegra 2 integrated graphics product running inside tablets and smartphones from various vendors. Nvidia will launch its quad-core Kal-El mobile processors, the follow-up to Tegra 2, later this year.

IHS iSuppli mentions another significant, though smaller, competitor to main industry players in VIA, whose integrated graphics processors are directed at embedded products and industrial applications. AMD's Fusion APU platform has also been optimized for embedded systems, particularly with the company's G-series embedded processors that leverage the Brazos integrated APU with AMD's low-power x86 architecture, and the addition this month of an embedded systems partner track to AMD's Fusion Partner program .