RealTime IT News

Transmeta Restructures, Swaps CEO

Transmeta announced sweeping changes to the company's business model along with a top executive change to support it.

The Santa Clara, Calif.-based firm said it will now primarily be known as a technology and intellectual property licensing company with special engineering services also available.

Transmeta said it has scaled back its chipmaking portfolio to include only its 90-nanometer (nm) Efficeon chip -- for "select customers" only. It will end-of-life its current Crusoe and 130nm Efficeon semiconductor products. The company said it was increasing prices and asking for pre-payments for parts in a new pay-as-you-go operating model.

As part of the restructuring, the company's board of directors promoted Arthur (Art) Swift to president, CEO and board member. Previously, Swift served as senior vice president of marketing and was behind the company's licensing and service business, which grew from $1.1 million in 2003 to $10.7 million in 2004.

Swift replaces Matthew Perry, who helped build the company over the last three years. Terms of Perry's departure were not disclosed.

Transmeta will cut 67 mostly manufacturing and marketing jobs in the restructuring. The company now has 208 employees around the world.

"This is not just a new chapter in the life of Transmeta. This is a whole new book," Swift said during a conference call with press and analysts.

The restructuring comes after the company hired an independent firm to critically evaluate its business opportunities and competitive conditions in the market for x86-compatible microprocessors. While Transmeta's focus on low power consumption and long battery life for fanless PCs and embedded systems managed to shake the trees of Intel and AMD , the company that once boasted Linux creator Linus Torvalds on its payroll suffered over the last year from a string of quarterly financial losses.

One aspect of the reorganization plan that was not discussed back in January is the addition of a 100-person engineering service led by CTO Dave Ditzel.

The group's first assignment is to work with Sony Group on expanding Sony's adoption of Transmeta's LongRun2 technology for its Cell derivatives and to collaborate in other engineering areas.

Swift said the engineers for hire have also been actively engaged with an unnamed partner for a non-recurring engineering (NRE) contract over the last few quarters.

"We have been collaborating with this partner, and we may derive additional business going forward because of it," Swift said.

Beyond the designs for its Efficeon and Crusoe chips, Transmeta is offering licenses for its Microsoft-enhanced AntiVirusNX technology; its battery and transistor power management enhancements, LongRun and LongRun2; and its Code Morphing tools. So far, most computer makers are interested in saving power. In addition to Sony, Transmeta has licensed LongRun2 to NEC and Fujitsu.