ATI, graphics product group of Advanced Micro Devices, may lower the pricing of its ATI Radeon HD 3000-series graphics processing units (GPUs) in weeks after the introduction in an attempt to recapture the lost market share from the No. 1 discrete GPU supplier Nvidia Corp. The decision will allow add-in board manufacturers to decrease the prices to end-users.

“Two weeks after the launch, the ATI RV670 drops the price,” a source familiar with the matter told X-bit labs.

The ATI Radeon HD 3850 with 256MB of GDDR3 memory begins at $179 manufactured suggested retail price (MSRP) and the ATI Radeon HD 3870 with 512MB GDDR4 memory from $219 MSRP, available from AMD’s selected graphics products partners. Unfortunately, not all suppliers of graphics cards could get the new boards on time from AMD.

ATI Radeon HD 3000-series GPUs support a breed of advanced technologies, including DirectX 10.1 that is expected to provide enhanced graphics effects in future video games; Avivo HD and UVD (universal video decoding) video engines for decoding and post-processing of high-definition videos from Blu-ray discs, DVDs or HD DVDs; ATI CrossFire X that enables up to four GPUs to work collaboratively; as well as ATI PowerPlay for desktops, which monitors graphics chip’s command processor to determine its actual load and decides its power state and cooling requirements.

Price reduction of the already not very expensive ATI Radeon HD 3800-series boards is likely to help AMD to capture attention of many end-users seeking for a new high-performance graphics cards for Christmas. Since the new lineup of graphics solutions support both DirectX 10.1 and high-definition video playback, the features demanded by end-users this year, the novelties truly have chances to become popular this holiday season.

Last year AMD managed to increase its graphics market share by about 2.1% to 23% with the ATI Radeon X1950 Pro and ATI Radeon X1650 XT graphics boards, according to figures by Jon Peddie Research. However, this year AMD’s market share has been on the decline, even despite of ATI Radeon HD 2000-series introduction, and currently the company commands 19.1% of the market, JPR claims.

But this year Nvidia is also pretty aggressive with its Nvidia GeForce 8800 GT graphics product, which is based on the G92 graphics chip. Even though the first weeks of availability did not prove that Nvidia’s partners are capable of shipping enough graphics cards to the market, the company may try to boost shipments of its chips to tackle AMD’s market share attack.

The first graphics cards in the ATI Radeon HD 3000-series product family are Radeon HD 3850 and HD 3870, which are based on ATI RV670 graphics chip and have 320 unified shader processors (SPs), 16 texture units (TUs), 16 render back ends (RBEs) and 256-bit memory controller. ATI Radeon HD 3850 clocks GPU at 668MHz and sports 256MB GDDR3 memory at 1656MHz, ATI Radeon HD 3870 graphics card features GPU operating at 775MHz and has 512MB GDDR4 memory at 2250MHz.

Officials for AMD did not comment on the news-story.