ATI's next generation was revealed to be N. Islands on an official roadmap back in 2009. It was meant to be a 32nm process, with release sometime between Q4 2010 and Q1 2011. Unfortunately, thanks to TSMC's 40nm botch-up, they lost confidence in the 32nm half-node, and canceled it completely - seeking to put their focus on 28nm.
This meant ATI's N. Islands had to be moved to 28nm, with a delay. TSMC kept slipping 28nm as well, and soon, it was quite apparent 28nm would not be ready in time for the delayed release of NI in Q1 2011.
http://vr-zone.com/articles/-rumour-...ands/8722.html