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Diamond branching into Web tablets

Known for its analog modems and graphics cards, Diamond will continue revamping its consumer strategy by introducing a Web tablet powered by a Transmeta chip.

SARATOGA, Calif.--One day after Transmeta came out of hiding, the company's first partner is set to follow.

Diamond Multimedia will announce a "Web pad" device using Transmeta's Crusoe chip today, people familiar with the company's plans said at an event here yesterday. Diamond, which makes such hardware as modems and video acceleration chips, recently began manufacturing a portable MP3 player and has previously flirted with tablet-sized computers.

Web pads, little bigger than their LCD screens, haven't yet hit the mainstream, despite being in development for several years. The easy-to-use devices are typically operated by pen, not keyboard and mouse, and connect to the Internet either wirelessly or through a wireless connection to a home networking station or PC. Industry heavyweights like Intel, National Semiconductor and Palm Computing have all experimented with the concept.

The move underlines Diamond's ongoing efforts to reshape its business. Although historically known for its analog modems and graphics cards, Diamond has been revamping its consumer strategy with its Rio MP3 player as the centerpiece. The device's popularity has encouraged Diamond to believe it can become the trusted name for digital gadgets.

In the future, Diamond wants to sell home music players and speakers that will pipe digital music into every room in the house, all connected by a Diamond home networking center.

Details on the Diamond Web tablet are sketchy, but the Santa Clara, Calif., company showed a copper-colored device on the stage at yesterday's unveiling of Transmeta's initial processors. Transmeta chief executive Dave Ditzel said in an interview that he expected the first products with the Transmeta chips to ship in the second quarter of this year.

The Diamond product will use Transmeta's lower-end 3120 chip, which costs between $65 and $89 and is in production. Web pads and other devices using the 3120 chip are expected to cost between $500 and $1,000, Transmeta representatives said yesterday.

Transmeta in fact demonstrated several Web Pads, including some equipped with handwriting recognition software and a radio transmitter that could be used to surf the Net. The company has geared its technology specifically to be used for Internet access devices, and favors use of a stripped-down version of the Linux operating system.

Ditzel said that such Web pads have a battery life of about 4 or 5 hours of use, though that duration will improve when the hardware can take advantage of the advanced power management features of the Transmeta technology. In addition, the duration increases dramatically when the device is idle.

The 3120 chip consumes 20 milliwatts of power when idle, Ditzel said. The 5400 chip consumes 8 milliwatts.

About a dozen companies plan to use Transmeta chips, Ditzel said. NEC, a manufacturer of notebook computers, is evaluating the chip, said Leonard Tsai, chief technologist at NEC's PC Silicon Valley Center.

Stephen Shankland reported from Saratoga and Stephanie Miles from San Francisco.