Intel has increased investment in its 'Steeley' low power processor that aims to deliver all day battery life to portable devices like the Ultra Mobile PC (UMPC).

The chipmaker had promised to deliver the chip by the end of this decade, but is now accelerating development to be ready by 2008, Intel chief executive Paul Otellini said at the Intel Developer Forum in San Francisco.

Intel's ultra mobile processor aims to deliver a reduction in power consumption by a factor of 10 over the technology that was available in 2005, enabling seven hours of battery life.

The chip will measure one seventh of the size of today's models, according to Otellini.

"The idea of getting all day life out of a highly portable, highly functional, highly featured device is now very much upon us," Otellini told delegates.

"This offers a new opportunity to developers to take advantage of this silicon development and find new opportunities for products."

Otellini promised that the chip will be capable of running full desktop operating systems including Windows Vista.

The first UMPC units started shipping earlier this year. Reviewers were disappointed by the system's limited battery life, small screen size and tweaked Windows XP operating system.

In a demonstration at the developer show, Intel showed off a future UMPC device with Wi-Fi and WiMax technologies that is capable of connecting to the onboard computer system of a prototype Volkswagen.

This enables the car's stereo to play streaming audio from the internet and allows the driver to serve video from the UMPC to LCD screens in the back.