Maybe they mean it will have a blu-ray drive and can play the Avatar blu-ray!
Or maybe they mean pre-rendered on rails shooters...

There is no chance that would happen unless Microsoft is planning on selling the next Xbox for at least $2000. Even then it may simply not be possible to handle CGI like Toy Story (the first one!) let alone Avatar in real time. I think the next Xbox and next PS3 are going to be relatively modest jumps in graphical fidelity compared to how it was last generation (good news for Nintendo as the Wii U won't nearly be as outgunned in the technical department as how the Wii was in this generation vs the 360/PS3).

I do think that the improved AI mentioned is much more likely and more economical, although that is still quite a lot of processing power to do it such a thing on a individual basis. Perhaps more groups of characters will act differently in situations or such.

Sure it will. It'll depend on the linearity of the game though.

Seeing how PS2 delivered Toy Story like graphics this comes as no surprise.

The only way i find this to be remotely possible is if AMD discovered some crazy new way to compute that discards all known computer process algorithms currently available. Not only this, but they also found a way to mass produce these chips as well and created an engine that can whip up extreme multi million nurb models with relative ease and a texturing program to match all the while keeping this secret from the world.

Chances of this happening is pretty much zilch, but if by some miraculous miracle of momentous magnitude they did all of this. Bravo. You have my full support of someone crediting you to actually creating the most significant technological breakthrough known to man kind......or i might just call it hax or alien support.

and it will retail for.........

599 US DOLLARS, no no wait.............

OVER 9000!!!!!!!!!!

Judging by the level of progress in visuals in PC games running on top end multi GPU VGA card set ups since 2007, I'll have to say it's highly unlikely at best. Nothing but smoke and mirrors from an AMD rep at worst.

While I'm sure AI and other technicals will be suitably improved, it's the rather ridiculous claim that even a 2-3 year future sub-$1000 box will be able to produce visuals anywhere near pre-rendered Avatar CGI levels that screams "Please quote me!"

I wouldn't doubt it, but what disc format would they use to hold the info?

Avatar was in the house of billions and billions of polygons per frame and it was slowly rendered in a super computer with a wooping 100 TB of RAM if I recall correctly, while your next gen console will be lucky if it manages 1/25,000 of that. So, honestly? Be grateful if it manages to render a frame of Avatar effects-graphic level in a minute.

This is PS2-toy-store-graphics all over again. Only to fool video game fans with no basic notions of graphic technology and claim unbelieveable stuff like "Crysis was DVD, so PS3 with Blu-ray will handle it"

Unless AMD is fundamentally reworking how graphics are processed in real time, then no.