By Eric Auchard

BARCELONA, Nov 21 (Reuters) - A little known French company says it may have an alternative if, as some fear, the technology industry's most important engine of progress - the capacity to multiply computer power while shrinking costs - has begun to run out of steam.

Moore's Law, the 50-year-old prediction that the density of transistors that fit onto the latest chips will continue to double every two years, has hit various road-bumps and delays in recent years.

While the insight by Intel Corp co-founder Gordon Moore has weathered predictions of its demise many times before, a growing chorus of experts say the thesis runs up against limits of what is atomically possible, or perhaps even technically necessary.

Enter Soitec SA, a modest-sized company based in the foothills of the Alps, which has made dramatic in-roads this year in commercialising an alternative that could prolong the useful life of existing chip production gear.

"There is a fork which has been created because of delays in bringing Moore's Law along," Soitec Chief Executive Andre-Jacques Aubewrton-Hervas told the annual Morgan Stanley Technology, Media and Telecoms investor conference on Friday.

The Soitec executive said consumer electronics makers see the relentless shrinking of chips as of secondary importance, and may be putting off investments in the most advanced tools from firms such as ASML, which holds an estimated 80 percent share of the market for crucial chip design tools.

Features like higher speeds and lower power consumption rather than how many circuits can be crammed on each chip are driving advances in the biggest markets for electronics such as mobile phones and other smart devices, said Aubewrton-Hervas.

A BACK-UP BET

The stakes are high as investors tune in on Monday to hear whether ASML, a world leader in semiconductor production tools, is overcoming hurdles to developing its next-generation of products, which the industry is counting on to drive progress.

ASML has scaled back timeframes for when the next generation of its core product line, known as EUV, or Extreme Ultraviolet Lithography, can move from its current experimental stages into mainstream use by the world's electronic makers.

Speaking at the same investor conference on Thursday, ASML Chief Financial Officer Wolfgang Nickl said he was comfortable his company could make EUV mainstream by 2018 or 2019, allowing the rest of the semiconductor industry to make further advances.

However, Nickl cautioned that it was not yet possible for ASML to know which customers would move when to upgrade to the company's next-generation EUV equipment.

"What is tough for us to say is what happens in between 2015 and that 2018 and 2019 timeframe," Nickl told the conference.

ASML holds its annual investor day briefing on Monday starting at 1300 GMT in London, where it is expected to spell out more details about the timing of EUV adoption.

Some, but by no means all, of the world's top chipmakers have begun to hedge their bets in case the latest tools for turning designs into semiconductors prove too unreliable to include in production roadmaps set out years in advance.

Soitec has signed up STMicroelectronics, Qualcomm , GlobalFoundries and the foundry business of Samsung Electronics. The latter two build chips for firms who can't afford to build their own chip-making plants.

These new contracts have helped fuel a 64 percent surge in shares of Paris-listed midcap Soitec so far this year.

Despite longer-term uncertainties, shares of ASML, the world's second-largest semiconductor equipment maker, has gained nearly 20 percent in the year to date. By comparison, the Euro STOXX Technology index is up just under 10 percent in 2014. (Editing by Susan Thomas)