The news comes fresh on the heels of a design win with Honeywell's WebPad, as well as an alliance struck with eMachines to design its new MSN Companion around the Geode architecture.

According to research firm International Data Corp. (IDC), the worldwide market for home Internet appliances is poised to grow to over 10 million units in 2002, up from 1.6 million units in 1999.

"By 2005, more than 70 percent of the world's Internet users will use information appliances to access the Internet," said Egil Juliussen, president of eTForecasts. "National is well positioned to capitalize on this market."

The Geode, an x86 architecture, integrates on-chip graphics, audio, memory control and a PCI interface. National said that it is responsible for more than 80 percent of the silicon that makes up the iPaq IA-2, which, in addition to the Geode GX1 processor, contains a Geode CS5530A companion chip, power management, audio ICs, operational amplifiers and National's Super I/O technology.

Compaq is aiming the new appliance squarely at the novice Internet user, a significant portion of the market. According to IDC, roughly 50 million households in the United States own a PC, while approximately 37-44 million households subscribe to online services. These numbers sharply contrast with the more than 70 million households that have cable-TV service.

According to research firm Intelliquest, while only about 40 percent of households in the United States subscribe to an online service, 80 percent have access to the Internet at work or school.

"Compaq has teamed up to provide a fast and easy way to get connected to the Internet," said Jim Ganthier, director and general manager of Compaq's Inter-Connected Products Group. "We (Compaq and National) had the right combination to bring easy access to novice Web users."