Transmeta looks East for entry into US portable computer market

California-based low-power microprocessor designer believes its fastest route into the US portable computer market may be via...

California-based low-power microprocessor designer believes its fastest route into the US portable computer market may be via Japan.

The company, which earlier this week announced its latest design win in Japan, hopes to use the popularity of its low-power microprocessor with Japanese portable computer makers as a backdoor into the competitive US market.

"The marketing strategy has been basically win big in Japan with our Japanese partners and export that success to the US through those partners," said James Chapman, executive vice president of marketing. "Having success with Japanese companies puts us in a good position to partner with those companies to bring this type of technology to the US market."

In many ways Japan is much more receptive to Transmeta's chips, which boast low power consumption as their chief feature and are therefore popular with portable computer makers. Among the first to ally with the chip designer were Hitachi, NEC and Fujitsu, followed by Casio, Sony and Sharp.

Transmeta's latest win with Japanese personal computer makers was revealed earlier this week when Toshiba, one of the world's largest makers of portable computers, announced a new version of its Libretto sub-notebook machine based on Transmeta's Crusoe processor.

Notebooks represent one of the strongest-growing segments of the Japanese PC market, and the sub-notebook sector, where many Transmeta-based machines can be found, is even stronger. Portable PC shipments beat those of desktops last year, for the first time, and sub-notebook shipments grew 48% to 1.4 million units, according to data released earlier this week by the Japan Electronics and Information Technology Industries Association.

By contrast, shipments of sub-notebooks in the US reached around 150,000 units last year, according to Chapman, who categorised them as a "very small segment" of the market.

"Quite frankly, it is being ignored by the major players," Chapman said.

However, a growing need for longer battery life -- Crusoe machines typically boast battery life at least double that of a standard notebook computer -- and portability is pushing some companies and their executives to reconsider these small, lightweight machines, said Chapman, who added he hope's Transmeta's strength in the sector in Japan will translate over to a similar position in the US.

"Currently Crusoe has a 60% market share (in the ultra-portable sector) and we are probably moving to an 80% share by the end of the year," said Chapman.

Transmeta is looking to Japanese rather than US companies to get a foot in the door because Chapman believes their manufacturing system is more suited to making the small machines.

"In general, these (major US computer) companies source most of their products from Taiwan and in terms of building this class of product, the Japanese technology is superior to the Taiwanese technology," he said. "From a supply line point of view, it's a little harder to build products like this."

Some of the major Japanese PC makers, such as NEC, Sony and Casio, are already selling their Crusoe processor-based machines in the US and others have plans to do so. Toshiba announced this week that it would follow the Japanese launch of the new Libretto with US and European launches.

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