Yep - the strategy seems to be to replace its X700XT – a competitor to NVIDIA's well received GeForce 6600GT – with a 12-pipeline RADEON X800 (possibly a RADEON X800 XL variant) featuring a 400MHz GPU core and 500MHz memory clocks, and ship it at an aggressive price-point, thereby enabling its AIB partners - such as Connect3D and GeCUBE - to supply to the channel at $249 or, probably, much less.ATI launched the Radeon X700 XT nearly three months ago, but cards have failed to materialize on the market, leaving the mid-range performance crown comfortably in the GeForce 6600 GT's hands. A 12-pipe X800 derivative would definitely have a shot at the mid-range crown, but at $250, would actually be closer in price to the GeForce 6800, which is available online for as little as $270.
Update Scott: I'm not sure how much of this is news. We'd already reported on the death of the 256MB version of the Radeon X700 XT and the introduction of the 12-pipe Radeon X800 as its replacement at $249 in our Radeon X850 XT review. That announcement came to us straight from ATI. The only remaining question raised by this rumor would seem to be the fate of the Radeon X700 XT 128MB, a card not yet available for purchase. I have asked ATI for clarification on its plans for that product.