IGN64 has learned that Nintendo's next-generation hardware, commonly referred to by the press as "N2000," is officially being called "Project Dolphin" (codename only) internally at Nintendo. The machine, which is still scheduled for a 2000/2001 release, will feature powerful graphics hardware comparable to that seen in PlayStation 2.

"Management is claiming better graphics than the PSX2," a Nintendo insider told IGN64. "And supposedly it will run on DVD, but that's still a big maybe at this point."

According to the source, four companies already have development kits and have begun making software for the Dolphin. Those companies are Rare, Retro Studios, EAD and Nintendo of America's local studios NST.

"The buzz is that the system is a lot easier to program for than the Nintendo 64," said the Nintendo source who wishes to remain anonymous. "And it appears Art-X [the system's graphics chip provider] managed to slap out a nasty chipset for pretty cheap."

Meanwhile, Nintendo is still keeping extremely quiet on the specifics of the hardware and isn't expected to announce anything in regards to the system at E3 in less than two weeks.

IGN64 will have more on the story soon.