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Sources close to graphics chip designer ATI Technologies said on Thursday that the company has not yet started commercial supplies of its next-generation R520 visual processing unit and that the chip firm is in process of re-spinning the chip so that to receive maximum yields of the processor when producing it in mass quantities.

According to a source who is familiar with the plans and ongoing actions at ATI Technologies, the company is working on a re-spin that is aimed to improve yields of the product so that the company could deliver as many next-generation graphics processors as possible. The source told X-bit labs that from functionality standpoint the R520 graphics processing unit is fully functional.

Re-spinning of a chip is a costly process, as every re-spin costs several millions of U.S. dollars. Still, provided that such a re-spin would improves commercial yield by a significant margin, the cost of re-spin will be compensated because of extremely high profit margin on high-end graphics processors.

ATI is reportedly playing a waiting game with NVIDIA Corp., who is expected to release its NVIDIA GeForce 7800-series graphics processors shortly. Once the benchmarks of NVIDIA’s part code-named G70 are out by independent review web-sites, ATI is expected to finalize specifications, such as clock-speeds, of its next-generation RADEON product. Still, given that the Markham, Ontario-based graphics firm is re-spinning its R520, it may not close to mass production of the product, which automatically puts the commercial release at a later date, particularly towards back-to-school season.

Because of potential R520 product delay, some analysts this week said they were cautious about ATI’s performance and concerned about possible market share loss by the company.

Interlocutors of X-bit labs also mentioned that the number of pixel pipelines reported by various web-sites may not be accurate, as internal organization of next-generation of graphics processors may depend on the type of work they perform. Furthermore, the number of pixel pipelines does not necessarily indicate performance and a lot depends on the number and efficiency of arithmetic logic units (ALUs) inside the chip as well as internal organization of caches. 

ATI code-named R520 VPU is projected to support Shader Model 3.0 and other innovations, which requires a totally new graphics architecture from ATI. Still, general specifications of ATI’s code-named R520 VPU are unclear at this time. Given that a new 90nm fabrication process is to be used for the manufacturing of R520, it is unlikely that the visual processing unit will be tremendously large in terms of transistor count and complex in terms of the number of pipelines. Fabless semiconductor designers tend to balance complexity of their chips for new fabrication processes. For instance, since 2002, ATI has not launched manufacturing of high-end graphics chips using a new process technology unless the technology was tested on mainstream chips. Still, even on relatively new manufacturing processes, ATI has set pretty high clock-speeds for its VPUs in the past.

“In the short-term, which I would call the next three to twelve months, the PC roadmap is still going to be a big driver for revenue growth for the company, with products including our [R]500 series and 90nm series driving growth in the desktop, notebook and workstation markets,” said David Orton, ATI’s CEO and President in a recent interview.

ATI has already showcased its R520-based graphics cards at E3 and Computex shows.

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