ATI Technologies, the world’s largest supplier of visual processing units, said Wednesday its RADEON X800 XL and RADEON X800 graphics processors would allow its add-in-card partners to sell their appropriate graphics cards for about $50 lower price-point than expected. The announcement may release price-war between ATI and arch-rival NVIDIA Corp..

“Now that we are in full production of our new RADEON X800 products we have had an opportunity to revisit our pricing. Based on several factors we are able to lower our pricing on these new products from what we originally announced. The new, final pricing has been established as follows: RADEON X800 XL (available from ATI’s partners), ATI’s SRP will be $299, RADEON X800 (available from ATI’s partners), SRP to be determined by each partner individually, however, we anticipate it to be priced around $199,” an ATI’s spokeswoman said.

The RADEON X800 XL and X800 visual processing units designed for systems with PCI Express interconnection, also referred as R430, are manufactured using TSMC’s 0.11 micron process technology, builds in 12-16 pixel pipelines along with 6 vertex processors, consists of about 160 million of transistors. The chip naturally sports all of ATI’s this year’s graphics innovations, such as 3Dc, Shader Model 2.0b, HyperZ HD, etc..

ATI originally targeted RADEON X800 XL to compete with NVIDIA’s GeForce 6800 GT ($399), while the RADEON X800 set to compete with the GeForce 6800 ($299) and GeForce 6600 GT ($199) graphics cards. With a bit lower prices, ATI’s products may have a price-related advantage over NVIDIA’s offerings. Earlier this month a rumour emerged that ATI planned to can the RADEON X700 XT in favour of the RADEON X800.

NVIDIA could not comment, whether the company answers ATI with price-slash, but usually each leading graphics company follows its rival with price reduction and promotional ad campaigns.