To some surprise, Intel recently announced that its first 32nm processors will also integrate graphics onto the CPU itself. This change, while not unprecedented, is an important one, and is already causing a battle between Intel and Nvidia.
It is no secret that Intel and Nvidia are involved in a bit of a quarrel, and have been for the last year or two. Intel, the seemingly invincible giant of the CPU scene, has been slowly changing its goals to include graphics solutions as part of its overall strategy. This came to a head when Intel announced Larrabee, a discrete graphics solution currently in development by Intel which could allow it to compete with companies like Nvidia and AMD. Nvidia, which (despite AMD's wonderful new product line) is the king of GPU sales, has not taken these encroachments kindly. Tempers have flared, feelings have been hurt - and now things look to be taking a turn for the worse.
Traditionally, the relationship between Nvidia and Intel has been an open one. Intel has allowed Nvidia to design and sell chipsets for their processors, and Nvidia has gladly done so, as it offers Nvidia the chance to promote their graphics solutions and their brand, in addition to simply selling chipsets. The advantage of Nvidia's chipsets is currently their superior integrated graphics chips. The modern chipsets, featuring 9300 and 9400 series integrated GPUs, are excellent all around products, providing a much more robust graphics solution, which is invaluable if you use your PC for media or want to crank up Vista Aero's options without worry. They leave Intel's IGP, the 4500 GMA, dead in the water.
Westmere, however, threatens to throw a wrench into the long-standing relationship. I won't go into the details of Westmere, as we already have an article which covers the architecture of the chip. However, if you haven't heard anything about it, let me summarize: Westmere is an Intel processor which places the integrated graphics (and a few other things) onto the processor itself. With Westmere, Intel integrated graphics won't merely be part of the motherboard. They will be physically attached to the processor itself.
In terms of performance, this is likely to have some advantages. But performance is probably not the only reason that Intel wants to make this move. By integrating graphics onto Westmere, Intel takes a jab at its chipset competitor, Nvidia. It also is attempting to undermine the marketshare of a company that many people believe will soon be a direct competitor of Intel's. Intel clearly wants to force Nvidia out of the integrated market, and integrating graphics on Westmere is a clear part of their plan.