The ultra small notebooks are one bright light in an otherwise depressed PC market outlook. But one OEM said he does not believe Freescale's Linux-based option will gain much market traction.

Freescale's new i.MX51 system-on-chip sells for less than $20 including a separate power management chip and a Linux software stack, enabling a sub-$200 netbook. By contrast an Intel Atom processor with a separate chipset, power management IC and copy of Windows XP costs $60, a fact that has pushed most netbooks into prices at or above $350.

The i.MX51 is based on an Arm Cortex A8 running up to a GHz, the first Freescale chip to use the new core. It includes a wide variety of integrated peripherals including a DDR/DDR2 memory controller, a vector floating point unit and graphics and imaging accelerators supporting OpenGL and Open VG graphics. It also includes an Ethernet controller and an ATA interface for hard drives.

"We believe we will have better performance and lower power" than many netbook alternatives, said Glen Burchers, a consumer segment marketing director at Freescale.

Besides Intel's x86-based Atom, a handful of chip makers are addressing the market for ultra mobile computers with ARM-based SoCs including Nvidia, Qualcomm and Texas Instruments. However, they generally use ARM11 variants running at 800 MHz or less and typically support mobile DDR rather than the less expensive DDR2 memory.

"When you go to 512 Mbytes RAM, mobile DDR is cost prohibitive," said Burchers.

The i.MX51 can decode audio at 18 milliwatts and 720-progressive video at 250 milliwatts. Freescale claims the chip can run a netbook for eight hours on two lithium ion cells compared to the Intel Atom which drains four cells in just two hours.