IBM (IBM) Monday said it has developed a tiny chip capable of transmitting an entire high-definition movie in a single second, a breakthrough that could make computers faster and more energy efficient.

The chip was made using existing production methods and works by converting electrical signals to laser light, allowing it to transmit 160 gigabits of data per second, enough to handle telephone traffic for all of New York City.

"We have worked out a way to ship almost inconceivable quantities of data at extremely low power," said Bernie Meyerson, chief technologist for International Business Machines Corp.

The chip is not expected to be used for entertainment or telephone networks anytime soon but could find its way into the powerful processors that run server computers in three to five years, Meyerson said in an interview.

The chip also promises energy savings since it uses just 2.5 watts of power, about one-third the amount used by a night light, and covers only 17 square millimeters.

"The amount of data you can generate on a chip is skyrocketing with the advances in the architecture and the technology itself," Meyerson said.

"You are being gated not necessarily by your ability to generate data but in your ability to move the data on and off the chip," he said.