Transmeta (Semiconductor) (TMTA)

[stack]

posting the entire article here, it's better for searching...

----------------------------
Transmeta developing new chip
COMPANY GETS A NEW LIFE

By Dean Takahashi
Mercury News

Transmeta was once a high-flying chip design company that had to retreat from a clash with Intel. But the Santa Clara company is once again designing low-power microprocessors, raising speculation about whether it already has a big customer for its new chip.

At an industry conference Wednesday, Transmeta described work it has done on a low-power microprocessor it described as ideal for a handheld computing device. The company's chief technology officer demonstrated an unannounced version of Transmeta's Efficeon microprocessor that balanced the need for high performance with the need to conserve power so that it could run in an Intel-compatible handheld device.

``We never said we would get out of the chip design business,' Ditzel said at the Spring Processor Forum. ``We will do anything that the customer wants.'

Particularly if the customer is a big one. Ditzel said in an interview he could not confirm speculation that Microsoft is the customer. But Transmeta said last year it was working on a new version of its Efficeon chip for Microsoft, and he added Tuesday, ``We are very optimistic about our project with Microsoft. It will be a good project for us.'

The new design represents a new strategic turn for Transmeta. After the company tried unsuccessfully for years to compete against Intel by designing chips for the laptop computer business, Transmeta ended its work on new general-purpose designs and moved into consulting.

But now it is evident that one consulting project involved creating a new microprocessor.

At a demonstration of the new chip Tuesday night, it ran ``Quake 2,' a PC game by id Software. At 700 megahertz, the chip consumed less than 1 watt, a level of power efficiency appropriate for a handheld device that needs to run on batteries for around four hours.

Even if Transmeta is creating a design for Microsoft, there is no guarantee that Transmeta would win that business, says Max Baron, an analyst at market researcher In-Stat, sponsor of the Spring Processor Forum where Transmeta revealed its plans. Baron expects that many companies would bid for the chance to design components for a Microsoft handheld.

``We could guess that they are working on a processor with Microsoft's help and funding, but the question I would ask is whether they have the right kind of design for it,' Baron said.

Transmeta announced last year that 30 of its engineers were working with Microsoft on an undisclosed project. The contract was signed by Rick Thompson, an executive at Microsoft who has been assigned to a special project. It does not involve Microsoft's Xbox team, a source said.

Ditzel said that Fujitsu will manufacture the new custom version of the Efficeon chip at a factory in Japan. Handheld systems require low-power chips because a handheld would melt down if it had a high-power chip.

Ditzel said, ``We aren't competing directly with Intel anymore. We're in the business of doing something unique and different.'

Contact Dean Takahashi at [e-mail] or [phone].