More bad news for Nvidia. Most analysts predict that by 2012 entry the level discrete graphics will be mostly gone.

Upcoming Fusion chips are taking over this volume market and they will probably be the best price performance solution especially in notebooks. Do we need to remind you that notebooks are taking over desktops and they are increasing its market share on a quarterly basis.

Ontario, AMD’s first Fusion chip that has both CPU and Graphics on a single core will be the first, and we can bet that Core i5 and Core i3 Arrandale / Clarkdale cores with both graphics and CPU are already started to hurt the entry level discrete market in both notebook and desktop.

This is just a warm up, as Sandy Bridge promises better CPU and graphics performance in Intel’s first Sandy Bridge monolithic core is going to get better. The first benchmark results are telling us that Sandy Bridge graphics are enough to replace current Nvidia and ATI entry level series graphics. It is still somewhat slower, but competitive nonetheless.

Once Fusion, Ontario and Llano enter the fray, there will be even more pressure on the entry level as the Llano graphics performance should be close to the 5600 series of current Radeon generation, which makes entry level discrete cards such as the Radeon HD 5400 series quite obsolete.

Many people expect that only mainstream, performance and enthusiast market will stick around after 2012 and we don’t know how good the next generation consoles are.