Integrated Graphics to Take Over Notebook PC Market - Analysts

Observers Expect Hybrid Processors to Command Notebook PC Market

by Anton Shilov
08/11/2010 | 10:24 PM

Even though the market of discrete graphics processing units (GPUs) for notebooks recently started to come back rapidly, analysts from iSuppli believe that eventually microprocessors with built-in graphics engines will take over the notebook PC market. Such chips, which AMD calls accelerated processing units (APUs), will allow to create smaller and more power efficient products.


In 2014, 82.9% of notebook PCs will use such microprocessors, up from 39% in 2010, as computer makers seek to offer smaller and more innovative products, according to iSuppli. Rising sales of these microprocessors is expected to have a negative impact on sales of standalone graphics chips, with the worldwide market for discrete graphics devices for PCs declining to shipments of 62 million in 2014, down from 73 million in 2009.

The charge toward graphics-enabled microprocessors is being led by ultraportable notebook PCs, with 90% penetration in 2014. Such small-form-factor systems benefit greatly from the use of highly integrated semiconductor solutions. Ultraportable PCs represent the fastest-growing segment of the notebook market, with global shipments doubling from 2010 to 2014, the marker research company claims.

According to recently released numbers by Mercury Research, sales of standalone GPUs for mobile computers set another record in Q2 2010: 19.395 million of units were sold, up 6% sequentially and 105.2% year-over-year. By contrast, 15.5 million of standalone graphics cards for desktops were shipped in the second quarter of calendar 2010, which is a sharp (21%) decline from 19.61 million supplied in Q2 2010 and a major (12.6%) drop from 17.73 million sold in Q2 2009. In total, 34.895 million of discrete graphics processing units (GPUs) were sold in the second quarter compared to 87.475 million integrated graphics solutions, according to Mercury Research.

Given the fact that many people now acquire laptops instead of desktops, they are more than likely to demand better experience than integrated graphics solutions can provide. As a result, already now the market of mobile GPUs is larger than the market of desktop GPUs. Perhaps, iSuppli's findings are a little too far-fetched scenario since ultra-portables - which historically were too expensive for general consumers - still represent an intagible part of the market and the recent drops in sales of standalone graphics adapters were caused by economic issues as well as rising prices of memory.

Still, there are many innovative form-factors that do require graphics adapters integrated into central processors.

“The booming popularity of products like ultraportable notebooks and Apple iPad has put the spotlight on products with small and innovative form factors. To develop such products, PC makers are adopting highly integrated semiconductor solutions that use less power and generate less heat, thus allowing smaller form factors. By integrating functions that normally would be implemented in a separate graphics chip, graphics-enabled microprocessors play a key role in aiding this effort,” said Matthew Wilkins, principal analyst of compute platforms at iSuppli.

Apple’s iPad also has demonstrated the appeal of a PC-type product that leverages a highly integrated silicon solution to achieve an innovative form factor. As iSuppli’s teardown analysis revealed, an important element of the iPad's design was the highly-integrated A4 microprocessor, which enabled the design of a system with a minimal space and cost dedicated to core electronics. Companies like Advanced Micro Devices and Intel Corp. are also working on highly-integrated low-power system-on-chip (SoC) devices, which will be able to power tablets.