Nortel inks deal with Microsoft

BANGALORE: Microsoft

and Nortel

entered into a strategic four-year alliance based on a shared vision for unified

communication.

The alliance will allow both companies to drive new growth opportunities and

transform businesses communications, reducing costs and complexity and improving

productivity for customers.

The agreement included provisions for extending it beyond the initial four

years. Nortel will be Microsoft's strategic partner for advanced unified

communications solutions and systems integration, the two companies will form

the innovative communications alliance and Microsoft and Nortel will deploy the

other's technologies in their enterprise networks.

Nortel and Microsoft will change traditional business phone systems into

software, with a Microsoft

unified communications software platform and Nortel software products to

provide further advanced telephony functionality.

This software-centric approach will provide the easiest transition path for

businesses, helping enable them to reduce the total cost of ownership and better

protect current and future investments. It will also more quickly enable the

creation of new, innovative applications.

"Nortel and Microsoft have each led fundamental transformations in their

own market - Nortel's digital innovation and Microsoft's software on every

desktop," said Mike Zafirovski, president and CEO of Nortel. "By

combining our unique strengths, Microsoft and Nortel will accelerate the

delivery of unified communications - delivering to our customers a

higher-quality user experience, with greater reliability and lower total cost of

ownership. That's where we can make a real difference."

"We are investing together because the communications industry is at an

inflection point," said Steve

Ballmer, CEO of Microsoft. "We will have deep collaboration in product

development with Nortel, allowing us to rapidly deliver high-quality, highly

reliable solutions that will support mission-critical communications. The

opportunity for our customers is fantastic. We will enable them to realize

tremendous economic and business benefits from unified communications."

"This is a gutsy play for Nortel - accelerating the move of our voice

technology into software and working with the world's software leader as part of

our broader business strategy to transform the company into a software and

services leader," Zafirovski said. "From this transaction, we believe

we can capture well beyond $1 billion in new revenue, ramping up with increased

momentum through 2009 via professional services, voice products and

applications, as well as data pull-through in the enterprise."

"Unified communications will drive the next major advance in individual,

team and organizational productivity in today's 24x7, always-connected and

increasingly mobile work environment," said Jeff Raikes, president

(Business Division) at Microsoft. "Our software-based approach puts people

at the center of communications through a single identity across e-mail, voice

mail, voice over Internet protocol (VoIP)

call processing, instant messaging and video, and intuitively embeds

communications capabilities into people's everyday work processes, including the

Microsoft Office system and third-party software applications."

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