IBM's decision to cancel the development of a Thinkpad notebook PC based on Transmeta's Crusoe chip has shaken confidence in the supplier in the run-up to its flotation on Monday.
While Big Blue still intends to manufacture the processor as planned, it has cancelled a project to commercially develop a Crusoe-based Thinkpad 240, which it demonstrated at PC Expo earlier this year. IBM was expected to release the product towards the end of this year.
In a statement the company said: "This particular project with Transmeta, and the Thinkpad 240 with the Crusoe chip, has been cancelled. We are always looking for technology that will enhance customers' notebook computing experience to include longer battery life, and will continue to consider Transmeta along with other suppliers for future Thinkpad models."
While the vendor refused to clarify the reasons behind its move, speculation is currently centring on how well it had been able to get the chip to perform and uncertainty as to now it would position it in the market.
"In terms of the benchmarks coming back, [Crusoe] got a bad rap for benchmark performance compared with an Intel or an AMD," said Mark Margevicius, a research analyst with Gartner. "In its defence though, the architecture of the chip does not do well under the current benchmark mechanisms - you could argue they are unfair."
"The improvement in performance is not nearly as strong as [IBM] thought. You get maybe an hour extra - and that is too little to be a compelling reason to use it," he added.
Who's got the power?
Transmeta claims that Crusoe consumes just one watt of power when running, compared with the 15 to 20 watts that Intel's Pentium uses, which significantly improves battery life.
Very long instruction word (VLIW) code morphing software undertakes a number of functions in software that were previously handled by silicon, and the company's LongRun power management technology adjusts speed and voltage dynamically to optimise the chip to process any given application.
But Margevicius pointed out that Intel's rival SpeedStep technology also produced significant improvements over previous performance levels, and said he expects to see future enhancements from Intel in areas such as power and performance management.
Ed Kernan, Transmeta's director of marketing, said the company's planned flotation meant that he was unable to comment on IBM's decision, but he confirmed: "When you talk to NEC, the 10 hours of battery life it has achieved went way beyond the eight hours IBM was talking about."
He argued that Crusoe offers other advantages beyond improving battery life, however. "Attributes high on customers' lists are low power and low thermals - and this is something that Intel hasn't talked about much," he said.
"If you are to look at a range of applications, there are a certain amount that will drive it up to the point where you can't get the heat out of the box. It's about one-fourth or one-fifth of that level with Crusoe, and that means we can get into thinner and lighter form factors."
Kernan added that Crusoe also costs about half that of a Pentium III.
While Andy Brown, a senior analyst with IDC, acknowledged that the processor may not have performed as well in benchmarking tests as IBM expected, he believed there are other reasons for Big Blue's decision.
"I think personally that it [IBM] is worried about performance," he said. "However, I think the biggest problem had more to do with the fact that it didn't fit with its product line, particularly now it has transitioned from the 240 to the X20 for sub-notebooks."
Crusoe has an obvious niche in the sub-notebook market where weight and battery life are crucial. While this sector comprises a major part of the notebook market in Japan, it accounts for only 10 per cent of the worldwide portable PC market, according to Gartner.
And although Brown said he believed Crusoe would come into its own once the consumer ultra-portable market took off, he warned: "Battery life is only really important to corporate users, and they feel safer with Intel SpeedStep. It's tried and tested, and I think Transmeta has to prove itself."
"Vendors need to see that it's viable to incorporate this into their product lines - they don't want to mess up their relationship with Intel for something that's not going to work. It will be interesting to see if other vendors follow suit," he added.
But several, at least, appear to be pressing ahead with their plans to build Crusoe-based machines. A spokesman for NEC said the company was happy with the chip's performance. "We have already started to introduce Crusoe-based PCs in Japan, and eventually will launch them in the rest of the world," he explained.
Meanwhile, Fujitsu has announced two Crusoe-based notebooks, which are due to ship this month, and Sony has said it will use the processor in its new Vaio PictureBook C1VN notebook. The supplier claims that Crusoe should nearly double the battery life of the new model.
Shock to the system
But Margevicius warned that losing IBM's support is a blow to Transmeta's credibility. "The IBM announcement is something that it does not need at this point, and I do not know how it will affect the share price," he said. "In order for Transmeta to succeed, it was dependent on a major notebook vendor committing to the platform. What Transmeta needed was strong credibility with a major manufacturer - and NEC and Sony are good companies, but not major players in the notebook space," he added.Brown, on the other hand, believes IBM's move may have a knock-on effect on Transmeta's relationships with other original equipment manufacturers into the longer term. "IBM dropping it is a massive blow. It can't be giving out positive signals to the other vendors," he said.
"If IBM is not prepared to support something it's manufactured itself, then what does that say to Sony and Toshiba? It can only be a bad thing, and it doesn't bode well for the IPO [initial public offering]. With technology stocks as volatile as they are at the moment, it's a very difficult market anyway," he added.
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