It looks like nVidia is working on something that uses the GPU to do physics processing.
FOR IMMEDIATE RELEASE
SANTA CLARA, CA—March 20, 2006—NVIDIA Corporation (Nasdaq: NVDA), the worldwide leader in programmable graphics processor technologies, and Havok, the game industry's leading supplier of cross-platform middleware, will be demonstrating a physics effects solution that runs completely on a graphics processing unit (GPU) —an industry first—at this year's Game Developer Conference (GDC) in San Jose, California (March 21st through 24th).
The result of an ongoing engineering collaboration between Havok and NVIDIA, this new software product from Havok—called Havok FX™—enables the simulation of dramatically-detailed physical phenomena in PC games, when powered by GPUs such as NVIDIA GeForce®7 or 6 Series GPUs and further amplified with NVIDIA SLI multi-GPU technology. The Havok FX product is currently in early release to select developers and is expected to be available this summer.
Through Havok FX, GPUs can simulate the interactions of thousands of colliding rigid bodies, a fundamental technique of physics computation seen in today's latest games. It's now possible to compute the components of friction, collisions, gravity, mass, and velocity that form the basis of rigid body physics. Havok FX is designed for GPUs supporting Shader Model 3.0, including the NVIDIA GeForce 6 and 7 Series GPUs.
Utilizing Havok FX and NVIDIA graphics technology, game developers can now implement sophisticated physical phenomenon such as debris, smoke, and fluids that add immense detail and believability to game environments. Game designers can include advanced physics effects without burdening the CPU and slowing game-play, since the effects are simulated and rendered on the GPU.more here