Jon Peddie Research (JPR) has released a follow-up to its recent GPU sales report, this time specifically targeting the graphics add-in-board market. As the GPU sales report includes AMD’s (NYSE: AMD) APUs and many new Intel (NASDAQ: INTC) CPUs which have GPU cores, the AIB report is a more specific barometer of the health of the video card market overall.
According to JPR’s report, sales of AIBs declined 17.5% quarter-over-quarter and 17.6% year-over-year. In comparison, last year’s quarter-over-quarter rate for the same period was 5.5%. This comes in the face of an overall PC market that’s improving quarter-over-quarter by 1.3%.
The attach rate to 36%, down from 44% last quarter. The record for attach rate remains at 63% during the first quarter of 2008.
Breaking down the sales numbers by vendor, Nvidia (NASDAQ: NVDA) fared the worst in terms of decreases, taking a hit of 21%. AMD had a decline of 10.7%.
Despite having the bigger decline than AMD, Nvidia still remained the market leader holding 62% market share overall.
Not Just an Integrated Problem
It would be easy to blame the great GPU decline on the success and competitiveness of CPU-GPU integration. Both AMD and Intel’s offerings have substantially and consistently improved over the past few years, so much so that they are taking a bite out of the discrete graphics card market.
But for enthusiast gamers, the need for a discrete card will never go away. This is the market group that has the budget and willingness to spend on serious GPU horsepower. But there’s a problem: the discrete graphics cards that this group bought last year, or even the year before, are good enough for the majority of today’s games.
4K gaming, which has the potential to drive more GPU sales, is increasing fast but still in its infancy. Until affordable 4K displays hit the mass market, this market segment can’t mature from niche to mainstream. Also, another factor is that game developers generally try and build games for the Xbox One and Playstation first then port later to PC. This means that this generation of graphics cards are hardly pushed to their respective limits. Until 4K gaming becomes mainstream, or developers start to create games that push these latest graphics cards, it will be hard for GPU vendors to convince gamers they need a new graphics card.
