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AOL, Gateway Tap Transmeta Chip

Gateway Inc. and America Online Inc. Tuesday announced plans to use a processor from Silicon Valley newcomer Transmeta Corp. in a Linux-based Internet appliance set to debut later this year.

The deal marks a milestone for both Transmeta and Linux as Gateway and America Online is breaking rank with leading chip manufacturer Intel Corp. and software giant Microsoft Corp. to develop the lineup of Internet devices.

The decision further affirms the Linux-based operating systems ability to grow into mainstream Internet use. It also tags Transmeta's chip design as an inexpensive alternative for low-power microprocessors.

The Transmeta Crusoe smart processor was tapped power the new line of network-ready IAs. Transmeta's Crusoe processor is ideally suited to power IAs and handheld devices because it offers extended battery life, can be used in small devices, and offers lower operating temperatures than traditional processors.

AOL and Gateway will also use Transmeta's version of Mobile Linux as the operating system for these products.

Peter Ashkin, Gateway senior vice president and chief technology officer, said Crusoe and Mobile Linux would help support Gateway's strategy of offering consumers easy-to-use portable Internet access and AOL's family-friendly content.

"Crusoe is a great processor choice to help us to deliver the kind of new Internet services that consumers will value in this new marketplace," Ashkin said. "Mobile Linux will enable our wireless IAs to deliver the performance around the house that our customers will expect."

David Ditzel, Transmeta chief executive officer, said AOL and Gateway have the best overall strategy in the emerging Internet appliance space and the firm thrilled to have a strategic relationship with both of them.

"At our launch in January, we promised Crusoe would usher in a new world of mobility," Ditzel said. "With their innovative approach to Internet appliances for the home, Gateway and AOL are playing a significant role in moving that vision forward."

Gateway made a strategic investment in Transmeta in April and selected Transmeta's Crusoe processor for inclusion in the family of products its launching with AOL.

At the same time, AOL and Gateway formed a pact to offer consumer Internet appliances featuring "Instant AOL" wireless Web pad services. Powered by Netscape's thin browser technology using the Linux operating system, the titan tandem is unveiling a series of specialized IAs for home and business use in a growing wireless world.

At the time the strategic alliance was formed, Bob Pittman, AOL president and chief operating officer, said AOL's research showed that its members place high value on their ability to access Internet content on new portable devices in addition to the home PC.

"These easy-to-use appliances are an excellent way of providing the whole family convenient access to AOL's many popular features, content offerings and services from anywhere in the home," Pittman said. "We are excited that these appliances will enable consumers to do everything from checking news headlines to ordering groceries or even updating the family calendar from virtually anywhere with just a touch of a button."

Pittman added that the specialized family of AOL-Gateway appliances featuring its instance access services was a major step fulfilling its "AOL Anywhere strategy."

"As consumers continue to add devices to their PC experience and make the Internet a more constant companion in their lives, the appliances will give consumers an 'insta