Even though end-users acquired unprecedented number of discrete desktop graphics cards in the fourth quarter of 2007, it seems that customers shifted back to more affordable solutions from higher-end graphics boards earlier during the year, which negatively impacted average selling prices.

During the Q4 2007 there were 106.37 million graphics adapters sold, up 16.8% over previous quarter and up 27% compared to the same quarter last year, figures from JPR show. The market of desktop graphics adapters grew 8.3% in the fourth quarter to 66.8 million units. Approximately 31.65 million discrete desktop discrete graphics adapters (29.7% of all graphics adapters or 47.4% of desktop graphics cores) were shipped in the last quarter of the year, which is up 23% sequentially and 50.3% annually.

The pace at what the market of desktop discrete graphics solutions grew in Q4 2007 is spectacular, but as mass customers started to acquire standalone graphics cards, they focused on more or less affordable solutions, not the high-end parts that retail for $249 and more. As a result, while revenue-wise Q4 was the strongest quarter in 2007, average selling price of a graphics card dropped below that in Q4 2006, which may be an alarming sign.

“Revenue on the surface appeared very strong, up 46.3% year-to-year. But when considering that ASPs dropped 19% from Q3, vendors may have been a bit disappointed the quarter didn’t see bigger spending. JPR attributed the ASP drop both to model transitions and product turnover at market leader Nvidia, as well as consumers’ holiday shopping, which tends to focus more dollars on lower-priced products,” analysts from Jon Peddie Research explained.

Among vendors, Nvidia increased its lead in market share in Q4, now responsible for 71% of all units shipped, up from 64% the previous quarter.

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