Under the terms of a parntership announced here late Thursday, the two companies will co-develop low-power processors that combines Transmeta's Crusoe family of x86-based MPUs and Seko Epson's "energy-saving" chip technology.

The companies are cooperating on several other fronts. First, Seiko Epson and Transmeta will establish a cooperative relationship toward the development of a technology partnership or alliance in the Internet appliances field.

Second, Seiko Epson and Transmeta will collaborate and share information about their "energy-saving" technologies in an effort to develop higher-level peripheral chip sets and other devices for Crusoe microprocessors.

And finally, Seiko Epson has licensed to Transmeta a limited portion of its patents and patent rights relating to microprocessor technology.