The mobile module - a 10mm-thick daughtercard that houses the CPU and chip set - is too large for the ultra-thin devices, according to several PC makers and analysts.
MMO was developed to help notebook makers quickly and easily design in the latest processors.
However, "you cannot get [MMO] into notebooks that are much smaller than about 1.5-inch high," said an executive with a top five notebook PC maker, "so not everybody wants it."
As a result, for the foreseeable future, ultra-thin notebooks will not be able to support Intel's latest processors, such as the Pentium II.
Although the ultra-thin segment is only one of several portions of the notebook market, it is growing quickly. Many leading notebook PC makers have developed or are in the process of developing ultrathin units, including IBM, Digital, NEC, Gateway 2000 and Compaq.
Currently, Intel's mobile processors - even Pentium with MMX - are housed inside the thin tape carrier package. More advanced processors such as the Pentium II cannot be packaged in the tape carrier package, said officials at Intel.
As a result, OEMs may end up implementing proprietary designs to get a Pentium II into the thin notebooks, a process that could drag out product cycles. "It's going to be a problem," said Linley Gwennap, editor of The Microprocessor Report in Sebastopol, California.
Gwennap suggested that Intel sell the Pentium II to OEMs as a stand-alone part. The chip would not come in any special packaging, and OEMs would implement it in whatever way they could.