The Raspberry Pi is a dirt cheap mini-computer with a Broadcom BCM2835 700 MHz ARM11 with Broadcom VideoCore graphics. A basic model with 2 USB ports, HDMI and Ethernet sells for about $35, and the developers plan to offer an even cheaper $25 model without Ethernet soon.
While the processor isn't very powerful, the Broadcom graphics chip can handle 1080p HD video playback. That means that in addition to using the Raspberry Pi as a basic computer for running a desktop Linux operating system, a controller for an automated system or other simple tasks, the Pi also makes a halfway decent media center or video game console (as long as you're cool with playing older games).
But there are limits to what you can do with the Broadcom graphics card right now, because while the Raspberry Pi runs open source software, the graphics drivers are based on proprietary, closed source code.