The Imageon 2300 product line, announced on Wednesday, builds on ATI's reputation in the PC gaming market, where the company competes with market leader Nvidia. ATI recently to build graphics chips for Microsoft's next-generation Xbox game console.
3D gaming hasn't yet taken off on mobile phones, but wireless gaming overall is already popular and is expected to generate $1 billion in revenue for U.S. telecommunications companies alone by 2006, according to research firm IDC. Phone giant Nokia was one of the first to exploit the market, with its, which combines phone and gaming features.
"Imageon 2300 enables exceptional 3D gaming that will fully leverage and help monetize the higher bandwidth offered by 2.5G and 3G networks," Azzedine Boubguira, ATI's marketing director for handheld products, said in a statement.
The chip is designed to take on other handset graphics-processing chores besides 3D: it handles 2D graphics; MPEG 4 decoding for 30 frames-per-second video playback; video capture; and image compression and decompression.
The Imageon line supports the OpenGL ES programming interface for rendering 3D, a subset of the OpenGL API (application programming interface) used in the PC world.
The line of chips, on display at this week's Consumer Electronics Show in Las Vegas, is at the sampling stage of manufacturing. Shipments will begin in the first quarter of this year, ATI said.
To date, the most visible effort in bringing 3D to handsets has been thecore developed by U.K. chip designer ARM and Imagination Technologies. The core is based on Imagination's PowerVR rendering technology, earlier used in the Sega Dreamcast game console.
ARM said several chipmakers, including Texas Instruments, have already licensed PowerVR MBX, and that the first products that use the technology should appear this year or next year.
ZDNet UK's Matthew Broersma reported from London.