McMick wrote:DISCLAIMER: This may be full of inaccuracies but I think I have the gist of it down.
Unfortunately I have to disagree.
You don't distinguish between onboard and integrated sound, and you don't mention software. Both are far more relevant for the situation today than one (out of many) takeovers of a smaller silicon company by a larger one. Also your story is DOS-based, but around the time discrete cards started disappearing (1999-2000) DOS support was completely irrelevant in the mainstream.
So what did kill the soundcard? Two things:
1) Microsoft's DirectSound API. Starting with Windows95, developers didn't have to program for specific cards anymore but could simply work with DirectSound and let the OS handle the card. This meant that card features became far less relevant and essentially all cards degrading to a DAC-like role. A3D and EAX were attempts to add value at a hardware level again, but eventually they migrated to software too. This development is why you see a dramatic simplification of soundcards designed for Windows. Where the last DOS-based ISA cards could be big, baroque beasts like the Soundblaster AWE32/64, Gravis Ultrasound, Ensoniq Soundscape Elite, Terratec AWS64 etc, Windows PCI cards tended to be much, much simpler, usually with a single controller chip and all the fancy stuff being done in software.
2) Intel's AC'97 standard, more specifically the integration of the DC97 audio controller into the southbridge of the chipset, starting with the i810 chipset in 1999. That audio controller was the equivalent of the main chip on a discrete sound card. All that a motherboard vendor needed to add sound was a tiny, cheap codec chip, and the interface for the codec was standardised. That was wholly different to earlier onboard audio, in which all the regular components of a sound card were stuck onto a motherboard - which added far more complexity and cost than an integrated solution.
AC'97 was quickly taken up by all major chipset vendors, as not to do so would be a significant competitive disadvantage (higher costs of onboard or discrete audio vs integrated), which meant that by 2000 the low-end sound card market was basically stone dead. In the high-end, positional audio and better SNR were still reasons to buy sound cards, but as positional audio also moved to software and the quality of integrated sound solutions improved, this market eroded too. Lower CPU usage was also mentioned, but as CPUs got more and more powerful, the impact of doing a little audio processing became less and less relevant. So in the end, by 10 years ago, the market was left entirely to the audiophiles.