Because nobody buys desktop. Sales are dipping nearly 20% per quarter, for some vendors more than that.
Like it or not, the first gateway computing device for the average consumer is a tablet or macbook/portable. For me, it was a desktop from Best Buy - and I eventually became an enthusiast DIY. Obviously in this example, do you see the problem here? If nobody buys desktops, whats the problem? There are fewer customers for discrete. Period. It won't be immediate, but unless you're oblivious to trends - it will happen. Maybe in 5 years, 10, we'll see.
The other point to consider is that iGPU is gaining performance at such an exponential rate - eventually the performance will be so good, and it will shut out traditional discrete manufacturers from the low-mid range market completely. Because of this shut out of the market, it will be that much harder to fund R+D - leaving them relegated to the high end market. As someone else said, if intel matched the GT650M this generation, what will it be next gen? The GT770M? Eventually the performance of iGPU will be so high that it shuts nvidia out from a majority of the market. And i'm afriad that will cause R+D costs to be prohibitively expensive, and will eventually necessitate an exit from the market. Nobody knows when this will happen, it could be in 5 years, 7 years, who knows. But at some point and time, it will happen. It will be a very slow and gradual shift. Look, nvidia knows this will eventually happen - this is the entire reason that nvidia spread their wings and entered the ARM SOC market. They know that discrete won't last forever - it's good money to them for the time being, and I personally think it will last them at least 5 years. Maybe more but it depends entirely on intel.
The tides are turning. The market is sustainable now for the hard-core enthusiasts but this WILL NOT last forever. This is not necessarily something that I like because I enjoy desktops! We speak the same language on this matter, and this is not something that i'm looking forward to. I like monster size dies with outrageous performance. But i'm afraid we're becoming the niche, not the norm. Eventually, we will either be phased out or face outrageously high costs due to being such a small niche.
PC sales have declined, because rubbish DELL/HP boxes made of trash cannot do anything special that ultrabooks now match or beat, and tablets/hybrids are replacing the typical usage scenario. There is less and less need for a crap PC. No doubt about this one.
But your point is off the mark, because how does this impact PC gaming? It has NO impact for PC gamers who still buy graphics cards like the gtx650ti or 7790 onwards. PC gamers that demand high details in their games, running full HD. Last I checked, people kept saying PC gaming is dying as well.. but its proving the naysayers wrong and wrong again every year. These PC gamers will still drive the demand for discrete GPU, because iGPUs are utterly worthless in comparison to a GPU that has a 150W TDP. Just because Haswell is able to come close to a 650M doesn't mean diddly squat to these PC gamers, as such, discrete GPU sales will be fine going forward. Unless you dream that somehow, PC gamers will stop caring about graphics pushing the boundaries with every new gen of games. Unlikely, we can agree on that.
Sure, iGPU is progressing very rapidly, but lets assume these new CPU are what, 250mm2, with half or more of that devoted to the iGPU? Lets be generous and give the best iGPU on haswell at 130mm2, with say, ~50% of that being the embedded vram. That's about 65mm2 for the GPU itself.
Its going to have to compete with a mainstream part that's 125-150mm2, with gddr5 not included in that die space. Lets give Intel the magic-sauce, and assume they can match NV/AMD in terms of perf/mm2 (this is a pretty big assumption!) and lets even be generous and give them a constant 1 full node advantage. At best, Intel's 65mm2 is going to be competitive vs a 130mm2 discrete IF its running at settings that do not saturate its embedded vram (3dmark is light on vram), if gamers cranks up settings, Iris is going to system ram and performance is going to tank, hard.
See scenarios where games would fill up 2gb vram these days? Happens often. So even in their best scenario for a long time forward, they will not be competitive vs the mainstream discrete. This and the mid-range discrete make up the bulk of GPU sales.
Lets not pretend to predict more than a few years into the future. It becomes about as reliable as anthropogenic global warming propaganda based on computer modelling (crystal ball gazing).. aka, worthless.
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