IBM says it has overcome a technological hurdle by producing a prototype chip with transistors that are just 7 nanometers wide, or about 1/10,000th the width of a human hair. The smallest transistors currently in use are twice as big.

The breakthrough occurred at SUNY Polytechnic Institute's Colleges of Nanoscale Science and Engineering. It could result in the ability to place 20 billion transistors on a chip the size of a fingernail.

According to The Wall Street Journal: "IBM's chip prototypes, which rely on a long-awaited breed of new production tools, don't prove its new technology will be practical in high-volume production, analysts said. But the developments could help IBM and its manufacturing partners pressure competitors like Intel Corp., while signaling that the industry can continue to overcome obstacles in boosting the speed, data storage capacity and power consumption of future chips."

Although IBM now subcontracts its chip production to Globalfoundries Inc., last year the computer giant announced a $3 billion investment over five years, partly to push the envelope on chip size. Thursday's announcement appears to be the fruit of that effort.

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