Graphics CPUs Near 50% Of PC Market

Graphics-enabled microprocessors (GEMs), which Intel and Advanced Micro Devices started selling this year, are gaining market share quickly and are expected to be in almost half of all client PCs shipping this year, a market research firm says.

Intel and AMD started shipping GEMs early this year, the former in its second-generation Core processors, codenamed Sandy Bridge, and the latter in chips AMD calls accelerated processing units (APUs). IHS iSuppli said Wednesday half of all shipments of laptops and 45% of all desktops would ship with the chips this year.

That amounts to about 115 million of the 230 million laptops computer makers are expected to ship by the end of 2011, the firm said. For desktops, the number of GEM-equipped units is expected to exceed 63 million.

The numbers are expected to continue to rise over the next several years. In 2014, 83% of laptops and 76% of desktops will ship with GEMs, iSuppli said.

GEMs refers to microprocessors that feature a CPU and graphics processor in a single chip design, providing more graphics capabilities than what was typically available in PCs without a separate graphics card.

"With GEMs capable of generating the total graphic output of a PC, no additional graphics processor or add-in graphics card is needed," iSuppli analyst Peter Lin said in a statement. "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."

Intel and AMD, the two biggest players in the PC microprocessor market, are driving the industry's move to GEMs. Computer makers are embracing the technology because it enables them to sell a PC with the same or better graphics capabilities as a system with a low-end graphics card. This cuts costs for the manufacturers, since the card is no longer needed on middle-of-the-road or lower PCs.

AMD is expected to respond to Intel's Sandy Bridge release this year with five GEM microprocessor categories, iSuppli says. A third x86 chipmaker, VIA, is offering GEMs for embedded and industrial applications.

The rising popularity of GEMs is not expected to eliminate the need for discrete graphics cards in higher-end PCs. People who want higher performance for games or video editing are expected to continue spending more for better graphics.

Therefore, while iSuppli expects some cannibalization by GEMs at the low end of the graphics card market, their impact on the overall market is not expected to be significant in the short or medium term, iSuppli said.