The growing demand for smartphones and tablets has opened up a new market for the company's processor architectures, which have been used in servers, netbooks, set-top boxes and mobile Internet devices in the past, said Art Swift, vice president of marketing at MIPS Technologies.

"Arm's had a virtual monopoly in the mobile-phone space for a decade," said Swift, who previously was CEO at Transmeta. "The people who are there would love to see more competition. It's an unstable situation."

The company was kept from the smartphone market partly because operating systems such as Nokia's Symbian did not support the MIPS architecture, Swift said. But Google's Android OS is fully compatible with MIPS, opening up new market opportunities.

"Android makes that a lot easier because of the processor-neutral environment it is based on," Swift said.

In September, MIPS released the MIPS32 1074K family of application processors, which it hopes to push into mobile devices. A few mobile system-on-chip makers have licensed MIPS-based designs, and handsets could reach market in the first half of next year, Swift said.