Despite a rise in unit shipments, the market value for desktop computer graphics hardware shrunk in the third quarter a leading research group finds.

Sales of PC graphics boards saw a 10.6 percent increase in unit shipment from the second quarter of 2006, and a 7.7 percent increase over the same period one year ago, Jon Peddie Research reported.

The desktop add-in board segment market value however continued its decline to $4.97 billion, after hitting a high of $5.88 in the first quarter of the year. The figure represents a decrease of 12 percent off the same period in 2005.

The firm believes that though 21.8 million PC graphics boards shipped during the quarter, overall market value declined due lower average selling prices (ASP).

Although the market value has been declining, we expect to see the fourth quarter show a rise due to the holidays, new products from Nvidia’s partners, and the increased gains in dual AIB systems, the market firm noted.

Jon Peddie Research forecasts that the total market value for add-in graphics cards will be $21 billion in 2006.