ATI is certainly getting big on the tessellation technique. This is a feature first introduced with Xenos the Xbox 360 chip, that can subdivide polygons in the smaller ones. Tessellation is a technique where you can subdivide a large polygon into a few smaller ones and this makes objects look more realistic without having to spend too many polygons. More polygons always means more calculations.
In the R600, the tessellation unit with geometry data compression can execute up to 15 tessellations, so it can subdivide for example a terrain in much smaller polygons and add much more detail in the scene. A single triangle can be programmable and divided up to 15 times per triangle edge.
This tessellation unit supports various implementations of tessellation including Bezier curves N-patches, B-splines and most important and much used in off line rendering, NURBS (Non Uniform B Rational Splines). You can subdivide 1,000 polygons to over a million new splines and with a little help of displacement mapping, you can get a very realistically looking terrain. You should take a moment and read a very informative part about it here.
I suggested that NURBS will become a part of graphic chips six years ago, but due the engine upgrade Mr Magee is credited for it. You can read it here.
Nvidia have been using B Splines from the Geforce 3 series and onward, but we wonder if the G80 can cope with NURBS.
Tessellation is not part of DirectX 10, but it should be part of the next DirectX upgrade scheduled for first half of 2008. Today it can be implemented via OpenGL, but we don’t know anyone who wants to use it in a 3D engine. Like DirectX 10 is not hard enough.