Ailing chip company Transmeta has been left reeling after Toshiba quietly shelved plans to release a laptop based on its low-power Crusoe chip.

The product that would have been a massive coup for Transmeta in its rivalry with Intel, has been discarded after numerous delays and problems with its chipmanufacturing and the scarcity of the processors themselves.

Since its inception, Transmeta has been fighting a "David and Goliath" battle with Intel, which has been tough on the new chip company, despite it intially winning over customers like Sony, Fujitsu, Casio and NEC.

Whereas Intel's processors are power hungry and only last a few hours on a battery powered laptop, Crusoe claimed to use less power through a software technique called "code morphing".

This technique takes Intel x86 code and translates it into understandable code for the Transmeta chip. Once translated, the code exists in a unique part of the chip's memory that is easily accessible.

Improvements to the translation software theoretically ups the performance of the chip and cuts down on its power requirement, so extending battery life.

Although a number of Crusoe notebooks are expected from Sony and other manufacturers, the dominance of Intel and the near moribund economic outlook could keep Transmeta sales down.