Comment 3 for bug 444139

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SteveE (steveedw) wrote : Re: Background and full screen apps don't show up when Normal Visual Effects on (Radeon 7500)

After much Googling, I got this working for the most part (except for the window decorations on liferea for some reason) by turning on KMS for Radeon in the kernel. A url which describes how to do this is http://ubuntuforums.org/showthread.php?t=1261990 . In a nutshell:

create a new /etc/modprobe.d/radeon-kms.conf that contains:

##enable KMS Radeon
options radeon modeset=1

Then execute the following command:
sudo update-initramfs -k `uname -r` -u

May not work with all Radeon cards is their caveat, but at least worked for Radeon AGP 7500. Other video issues I had were getting mplayer working (added vo=gl2,x11 to ~/.mplayer/config).

Video effects are at the same speed (if not faster) than they were under Jaunty.

From what I've read, this isn't a bug, Radeon KMS is still a work in progress from what I was able to read.