ATI's new Radeon 2000-series 3D graphics cards (code-named R600) were at one point supposed to ship this January. After a few more months of fine-tuning (and plenty of Internet rumors), today brought the official launch of the 512MB Radeon HD 2900 XT. This $399 card is designed to compete directly with Nvidia's 640MB GeForce 8800 GTS, which at press time you can find for as low as $330 with rebates.
The takeaway from the reviews around the Web is that the Radeon HD 2900 XT is loud, requires a lot of power, and stays competitive with Nvidia as far as performance and image quality, depending on the game. We found a similar conclusion in our soon-to-be-posted review of a dual Radeon HD 2900 XT-equipped Velocity Micro desktop PC (which we rate and test differently then we would a standalone graphics card).
With no next-generation DirectX 10 games out yet and both cards' driver software still works in progress, we expect that the performance story will evolve over the next few months. We should also add that ATI has announced its mainstream Radeon HD 2400 and Radeon HD 2600 cards, to be released in June, as well as its complete line of Mobility Radeon 2000-series graphics chips. Since all of these cards and chips can decode HD video, even if Nvidia becomes the eventual 3D performance winner, there's still another battlefield on which ATI and AMD can come out on top.