The story of the Transmeta Corporation is, in some ways, symbolic of the story of the Internet bubble of the late nineties.
Some point in early 1995, Dave Ditzel, of RISC-fame and formerly from SPARC started up Transmeta as its CEO. Paul Allen, one of the original founders of Microsoft and ludicrously rich, provided huge sums of venture capital.
Transmeta really made the headlines when, in 1997, they managed to attract one prominent employee -- Linus Torvalds.
Transmeta at this point was shrouded in mystery. Nobody knew what the company was doing. It became a bit of a running joke in the online community -- were Transmeta making graphics hardware, or some kind of robot? Some people even denounced the whole company as a hoax.
A link to the Transmeta website appeared at the bottom of the Linux kernel archives at kernel.org, but the page only contained the message 'coming soon....'. A quick peek at the HTML source code revealed a message saying something like "Sorry, there is no secret message here."
At the end of 1998, Transmeta filed patents on Code Morphing technology, which effectively acted as an emulator to allow a VLIW - type chip to run x86 code.
In November 1999, I had another look at the Transmeta website and was excited to find this hidden in the source code:
---Yes, there is a secret message, and this is it:
Transmeta's policy has been to remain silent about its plans
until it had something to demonstrate to the world.
On January 19th, 2000, Transmeta is going to announce and demonstrate
what Crusoe processors can do.
Simultaneously, all of the details will go up on this Web site
for everyone on the Internet to see.
Crusoe will be cool hardware and software for mobile applications.
Crusoe will be unconventional, which is why we wanted
to let you know in advance to come look at the entire Web site
in January, so that you can get the full story and have access to all
of the real details as soon as they are available.---
Yes, Transmeta were making a chip, known as the Crusoe which for a variety of technical reasons was perfect for portable devices. It could adjust its power usage between processor-ticks and it ran cooler so didn't need a fan. This enabled extended battery life, the major concern of notebook users' lives. It also did some damned clever things with an x86 software emulator layer, providing in theory the ability to make the Crusoe mimic different processors.
They also built their own version of Linux -- to a collective sigh of "so that's why they wanted Linus" -- called Midori, designed to be small, fast, and ideal for Internet appliances.
So it wasn't giant robots but it was still pretty cool, and as usual the analysts started saying "The game is up for Intel" (false), "The portable Internet device is the future" (possibly true) and "Everyone should invest in Transmeta" (definitely false).
Some companies, like Hitachi and Fujitsu, quickly announced their intensions to use the Crusoe in their notebook PCs, though it took a bit of time to get the chips out to OEMs.
Transmeta went IPO on the 6th of November, 2000 (Nasdaq: TMTA) with an initial price of $21 per share. By the end of that day's trading, they were going for $45.25 each.
These were the last of the heady days of the technology boom. People no longer believed the cliches like "anything seems possible" or "the way we do business has changed forever". Instead, world-weary venture capitalists tried their hardest to make one last quick buck before the bubble burst.
It burst. The Crusoe chips were good, but not $50-a-share good. The handheld Internet market, emergent in late 2002, was fairly non-existent in 2000. And perhaps most importantly, investors tired of high tech in general, and new high-tech in particular. Transmeta shares fell gracefully from $50 in November 2000 to as low as $2.50 a few days before everything changed. In October 2002 they bottomed out at $0.74, a measly 1.5% of their maximum value.
Transmeta today is based in Santa Clara, California and employs about 300 staff. It's smaller and a bit more realistic about its goals, but is still functioning, and as the market shifts more towards handhelds and wireless networking, perhaps we shouldn't write them off just yet.