In 2008, 67 percent of the graphics chips shipped were integrated graphics chip sets. In 2011 the segment will drop to 20 percent, and by 2013 it will be less than one percent, JPA projects.

Integrated graphics are used in desktops, notebooks and embedded systems such as point of sale computers and, set-top boxes. The market for discrete graphics chip and boards will not be impacts because computers will continue to use combinations of embedded and discrete graphics chips, according to JPA.

Intel's Westmere will be the first x86 processor with embedded graphics, debuting in late 2009. Archrival AMD will introduce its Fusion processor by June 2011. Both companies will employ 32nm process, JPA said.

During the transition competitors including AMD, Intel, Nvidia, SiS, and VIA will seek to develop new products that take advantage of their specific strengths, the company said.