It does not need to, if GT4e gets anywhere near a GTX750TI the market will suffer a lot, and already sufering a lot with that A8-7600 behing faster than a R7 240. and the rest of cpus just killed the low end dgpus.
The IGPs does not need to have 980TI perf in order to kill dgpus.
Let me rephrase that: "I don't think Intel is going to be able to challenge the middle and higher end desktop discreet graphics market anytime soon".
I'm not surprised at the killing-off of what was historically the low end segment. Had it not been the past couple years of GPU stagnation, GTX 750 and Radeon 7770 level performance would be in the low end of the performance spectrum. Hell, they are depending on your point of view.
AMD APUs were such a damn good value in how much graphics and CPU performance they provided in combination, it's not hard to see how they helped to kill off low end discreet. Intel IGPs were just the logical integration of a basic feature into the CPU, much like the FPU in the 90s. It was good enough to supplant low end discreet GPUs, especially in entry desktops and a good majority of laptops out there. Most buyers don't know, and don't care as long as it works for basic use. But it made laptop production quite a bit cheaper which is good for consumers.
Also, getting into Skylake with GT4e means building a system with it in mind (is it BGA like GT3e?). That means limited upgrade path if it's of concern. On the flip side, that doesn't mean as much anymore until some major breakthrough in IC fabrication and software necessitates moving onto new software and hardware paradigms. Plenty of people only need to upgrade their graphics performance and RAM intermittenly, so you have a poop-ton of people with decent quad cores already who have no use side grading to a GT4e system just for the CPU performance. That still leaves a rather big base of gamers and workstation-like systems that will need graphics upgrades as the years roll on. I am one of those people. Depending on what AMD comes out with in the next generation of cards, I may upgrade from my R9 270.
When 16/14 nm GPUs come out (next year hopefully), I think we'll see a nice boost in performance and value of discreet GPUs. 4K actually seems to be a popular thing, and that will require a very good dGPU for the time being.
You know what, I could be totally wrong and the whole dGPU market could go to hell anytime soon. I just don't see the end of it anytime soon, since Intel's process lead is about to not be so special anymore, and Intel can't just subsidize large iGPs. They need to make money like anyone else, especially in this post-PC market.