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Technology Stocks : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: Tenchusatsu who wrote (104962)	6/27/2000 5:32:00 PM
From: Road Walker	Respond to of 186894

Tuesday June 27, 3:21 pm Eastern Time Forbes.com Transmeta Unveils Crusoe's First Customers By David Einstein Several computer makers today unveiled plans to use low-power mobile processors from Transmeta, setting up an interesting battle between the upstart chipmaker and giant Intel in the market for ultralight notebook PCs. As promised, Transmeta used the big PC Expo trade show in New York to announce its initial customers. Fujitsu (Nasdaq: FJTSY - news), Hitachi (NYSE: HIT - news), NEC (Nasdaq: NIPNY - news) and IBM (NYSE: IBM - news) showed off thin, light portables running Crusoe chips, which are designed to consume less power than conventional chips, resulting in longer battery life. The announcement was dampened somewhat by a pre-emptive strike that Intel made last week, when it introduced some low-power chips of its own. Intel (Nasdaq: INTC - news) showed off notebooks from NEC and Toshiba (Nasdaq: TOSBF - news) equipped with the new power-saving Pentium IIIs and said that other companies--including Fujitsu and Sony (NYSE: SNE - news)--will also probably use them. Curiously, Sony wasn't among the first wave of Crusoe demonstrators, even though it has an investment in Santa Clara, Calif.-based Transmeta. At stake is the small but fast growing market for the slimmest, sexiest PCs--machines less than 1 inch thick and weighing less than 3 pounds. According to International Data Corp., shipments of ultralights should increase from 3.2 million this year to 5.7 million by 2004--giving them more than 15% of the notebook market overall. Transmeta's biggest weapon against Intel is its technology, which uses software to take some of the power demands off the chip and automatically adjusts performance to the requirements of particular applications. The design has garnered accolades from analysts like Tim Bajarin of Campbell, Calif.-based Creative Strategies. Bajarin says Crusoe will allow PC makers ``to offer designs for all day computing with full PC capabilities in a lightweight form factor.'' But Intel has built a similar feature for conserving power into the new mobile Pentiums. And transistor for transistor, Intel's chips may offer higher performance than Crusoe. More importantly, Intel is already shipping the new Pentiums in volume, while Transmeta doesn't expect to have that capability until late this year. (IBM manufactures the Crusoes.) That could allow Intel to seed the market with low-power chips and prevent Transmeta from making major inroads. Price-wise, the competition appears to be a wash, at least for now, with both companies charging around $300 for their most powerful low-power chips. But there, as well, Intel could have the edge. If Transmeta shows signs of stealing Intel's customers, Intel could easily undercut the newcomer's prices--a strategy that has served it well over the years against rival Advanced Micro Devices (NYSE: AMD - news). Transmeta officials either aren't afraid of Intel or are disguising their fear well. ``Quite frankly, what Intel showed off last week was an afterthought,'' says Jim Chapman, Transmeta's senior vice president of sales and marketing. ``It's good that they think low power is important, but their chips are nowhere near approaching Crusoe. We clearly have a first-mover advantage.'' Chapman thinks that advantage extends to Internet appliances, which promise to be a bigger market for Transmeta than ultralight PCs. The company scored a coup earlier this year--and set the tone for its rivalry with Intel--when America Online (NYSE: AOL - news) and Gateway (NYSE: GTW - news) chose a version of Crusoe to power the Internet appliance they are co-developing. Internet appliances are still a ways off, however. For now, Transmeta has its hands full fighting Intel.