Former Transmeta CEO goes at Intel with another low-power chip

Exclusive Matthew Perry - no, not that one - can't seem to escape the idea of dealing a devastating blow to Intel. The former Transmeta CEO has landed at chip start-up Montalvo Systems, according to our sources, and is running the company.

As we reported in an exclusive last October, Montalvo has been hammering away on a low-power x86 processor. At first, industry watchers thought the chip would be aimed at mobile devices such as PDAs. Now, however, we've learned that the super-secretive Montalvo is most likely chasing the notebook market with what's described as a "high-end, low-power chip."

Montalvo has an impressive assortment of chip experts on board, including Greg Favor, an ex-AMD fellow and designer of the K6 processor, Peter Glaskowsky, former editor of the Microprocessor Report and a ton of former Transmeta staff. (Thanks to an SEC filing, we see that Vinod Dham, former CEO of Silicon Spice, which Broadcom acquired, serves as a director of Montalvo as well.)

The Montalvo name is thought to come from the popular Silicon Valley spot Villa Montalvo where Transmeta first launched.

Transmeta hoped to dent Intel and AMD's hold on the x86 chip market by creating a low-power processor that used sophisticated software to crank through instructions. Perry became Transmeta's CEO in 2002 and then left the firm in April of 2005.

But, he didn't go far.

Transmeta's old offices sat at 3990 Freedom Circle in Santa Clara, wile Montalvo lists 3960 Freedom Circle as its home.

Perry did not return our call seeking comment.

Montalvo recently secured $74m in funding from New Enterprise Associates, Bay Partners, U.S. Venture Partners and original backer NewPath Ventures.

All those backers are sure to have thinned out the shares in Montalvo - bad news for employees hoping to get filthy rich.

We're impressed that Perry has the resolve to face the x86 market again and to do so with a similar pitch. Fighting Intel and AMD requires an incredible amount of capital, patience and luck. A strong notebook chip, however, could be of interest to AMD, which has struggled to replicate its server and desktop success in the mobile market. ®