What happened to Transmeta, the last big dotcom IPO

That's kind of the bet they made, but misses a key point.

Their fundamental idea was that by having simpler CPUs, they could iterate on Moore's law more quickly. And eventually they would win on performance. Not just on a few speculative edge cases, but overall. The dynamic compilation was needed to be able to run existing software on it.

The first iterations, of course, would be slower. And so their initial market, needed to afford those software generations, would be use cases for low power. Because the complexity of a CISC chip made that a weak point for Intel.

They ran into a number of problems.

The first is that the team building that dynamic compilation layer was more familiar with the demands of Linux than Windows, with the result that the compilation worked better for Linux than Windows.

The second problem was that the "simple iterates faster" also turns out to be true for ARM chips. And the most profitable segments of that low power market turned out to be willing to rewrite their software for that use case.

And the third problem is that Intel proved to be able to address their architectural shortcomings by throwing enough engineers at the problem to iterate faster.

If Transmeta had won its bet, they would have completely dominated. But they didn't.

It is worth noting that Apple pursued a somewhat similar idea with Rosetta. Both in changing to Intel, and later changing to ARM64. With the crucial difference that they also controlled the operating system. Meaning that instead of constantly dynamically compiling, they could rely on the operating system to decide what needs to be compiled, when, and call it correctly. And they also better understood what to optimize for.

I don't know if the bet was even particularly wrong. If they had done a little better job on performance, capitalized on the pains of Netburst + AMD64 transition, and survived long enough to do integrated 3D graphics and native libraries for Javascript + media decoding it might have worked out fine. That alternate universe might have involved a merger with Imagination when the Kyro was doing poorly and the company had financial pain. We'll never know.

I don't either. Even with their problems, they didn't miss by much.

One key factor against them, though, is that they were facing a company whose long-term CEO had written Only The Paranoid Survive. At that point he had moved from being the CEO to the chairman of the board. But Intel had paranoia about possible existential threats baked into its DNA.

There is no question that Intel recognized Transmeta as a potential existential threat, and aggressively went after the very low-power market that Transmeta was targeting. Intel quickly created SpeedStep, allowing power consumption to dynamically scale when not under peak demand. This improved battery life on laptops using the Pentium III, without sacrificing peak performance. They went on to produce low power chips like the Pentium M that did even better on power.

Granted, Intel never managed to match the low power that Transmeta had. But they managed to limit Transmeta enough to cut off their air supply - they couldn't generate the revenue needed to invest enough to iterate as quickly as they needed to. This isn't just a story of Transmeta stumbling. This is also a story of Intel recognizing and heading off a potential threat.

Intel was already built on the Pentium at this point. Not as iterable as pure software but decoding x86 instructions to whatever they wanted to do internally sped up a lot of things on its own.

Perhaps they would have been better off building the decode logic as programmable by making effectively a multicore machine where the translation code ran on its own processor with its own cache, instead of a pure JIT.