Integrated graphics (video card): A name used for a graphics adapter that is embedded into a motherboard chip, typically the Northbridge. Such devices cannot be upgraded and usually share system memory instead of having their own dedicated RAM. Often terms like Turbo Cache and HyperMemory are used when referring to a "shared" ram solution.
Discrete graphics: Discrete graphics refers to an independent graphics solution, often embedded onto the system board. Not part of the CPU or chipset.
Integrated graphics was created to offer a low cost solution for video. Mainly used on low end pc's and business systems. This allows for low priced affordable systems. They work great for general purpose systems but are terrible for anything that requires advanced graphics. The other problem with integrated graphics is that they don't have any way for you to upgrade your video. In order to save more money, they often do not include the ability to add a video card later on because they do not have the appropriate slots available.
It is even worse with laptops. When you buy a laptop you are stuck with what you purchased. Video options are not upgradable. If you see a laptop with an Intel chipset and Intel graphics, you not only have an integrated solution but one that can't game or do much else other than general purpose use.
What do game developers think of integrated graphics, which are largely the domain of chip-set giant Intel? Epic Games founder Tim Sweeney calls Intel "The bane of game developers," and notes that its products "are not acceptable for gaming today."
Now with Vista available we are just starting to see a turn for the better. However, the same problems still exist. Amd has just released its first integrated chipset, the AMD 690g. AnandTech has just recently reviewed the newest of the integrated graphics solutions. It is a very good article and I highly recommend reading it.
To sum it up. Intel 945 integrated video just doesn't cut it. It's fine for everyday use, but offers dismal game performance. Anand actually likes the amd/nvidia solutions as they are more mature. They bother offer acceptable game performance. They still do not compare to a discrete solution.
Here is the link to the gaming bench marks: http://www.anandtech...d...?i=2942&p=8
Higher the number, the better the performance.
For most people integrated graphics are fine. For gaming they just aren't up to the task. With Vista's heft resource requirements and with dx10 games coming out soon, I expect the integrated graphics to get a boost this year. The best advice I can give for those on a limited budget is to choose a system that will allow you to upgrade your video. That's great advice, but what if I'm looking for a laptop? Choose something that offers discrete graphics with dedicated memory.