Microsoft and Nortel Networks last week announced a broad agreement to develop and market unified communications technology, saying that their Innovative Communications Alliance should begin releasing products next year as part of a road map laid out by Microsoft in June.
At that time, Microsoft said it would team up with vendors such as Hewlett-Packard, Motorola and Siemens on unified communications initiatives. But Microsoft and Nortel detailed a more expansive set of plans, including the eventual development by Nortel of a full suite of networking hardware and software that can work with Office.
Nortel CEO Mike Zafirovski predicted during a jointly held teleconference that the alliance will generate about US$1 billion in added revenue for the struggling company over the next few years.
But Nortel users were mixed on whether they think the deal with Microsoft will give the vendor a big boost in its efforts to rebound from a series of losses, financial restatements and management changes.
Victor Bohnert, executive director of International Nortel Networks Users Association (INNUA) in Chicago, said the alliance should help Nortel re-establish its reputation as a market leader. "This represents two powerhouses coming together, and I don't think there's too much of a downside to it," he said.
A Microsoft and Nortel collaboration will be a good thing for IT shops if it enables them to do less software integration in-house, said Jason Delp, president of the Pittsburgh-Western Allegheny Meridian Users Group, which is aligned with INNUA.
Delp is on the IT staff at Coventry Health Care, a managed care provider and insurer in Bethesda, Md., that uses Windows, Microsoft's Office Communicator software and a Nortel network. "There's always the possibility that some Nortel users who are Microsoft haters won't like this alliance," he said. "But you have to face it that from the corporate perspective, the trend is toward Microsoft applications."
Nonetheless, Delp said he isn't convinced that working with Microsoft will help Nortel much. "After all its problems, Nortel is still in business, but who knows for how long," he said. "They still have an uphill battle.
"I wouldn't say that I would drink the Microsoft Kool-Aid just because we have Nortel already," said Andy Rebar, an IT staffer at Fujifilm Sericol USA. "We'd have to look at the benefits and weigh the ins and outs." Rebar is president of INNUA's Heart of America chapter.
Bill Lesieur, an analyst at Technology Business Research, said Microsoft and Nortel "will be pitted against the well-established Cisco-IBM duo in delivering IP telephony and unified communications."
The open question is how well Microsoft and Nortel will work together, said Forrester Research analyst Rob Whiteley. "It needs to be a fluid operation," he said, "or their customers will go to Cisco."