S3 was shouting about texture compression, as usual. While few games use it, we expect more future titles to support it. It just makes a huge performance difference to performance and visual quality. S3 was also pushing a new compression format called DXVn, which compressed volumetric textures.
Matrox was evangelizing matrix palette skinning (MPS). MPS is much like vertex skinning. They both make more realistic deformations, skin, clothing and moving joints on models. MPS is a form of skinning that has far more control and power than vertex skinning because it has more control points. MPS has the potential to make a huge difference when modeling complex moving objects like talking human faces and hands, where vertex skinning does not provide enough control points. Future T&L hardware will support MPS. Matrox also spoke about perturbation mapping, which is a technique of using environment bump-mapping for more than just bumps.
Direct Sound is the, believe it or not, sound portion of DirectX. There is one major change to Direct Sound.
DirectPlay Voice is a voice over IP add-on for DirectX. It will enable software developers to standardize on a method of voice communication over the Internet. This should be very useful in online team-based games.