There are certain graphics features such as Anti-Aliasing that, when enabled at high resolutions, take up a lot of local video card memory. When this local video card memory runs out, then things are sent to your computer’s system memory. However, the connection between your video card and your system memory is a lot slower than the connection between the GPU/VPU and the local video card memory. The optimal solution is to fit everything into local video card memory so you don’t incur performance hits. In today's games, 256MB of onboard memory has been sufficient for the most part. In an effort to show what is possible and to give us a glimpse of future video cards, ATI is equipping one of their own cards with 512MBs of local video card memory.
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