Microsoft and Polycom have struck a multi-year agreement to link Microsoft's Office Live Communications Server with Polycom's conferencing products.

Microsoft hopes the connection will spur sales of Live Communications Server, a business instant messaging and "presence" product, while Polycom is keen to sell more desktop video conferencing hardware, representatives from both companies say.

With Live Communications Server, companies can run their own instant messaging network. Such a system can monitor whether users are online and available for communication in Office applications and extends this "presence" information to other applications.

In the first phase of the collaboration, Microsoft and Polycom aim to ease communications within an enterprise by allowing users of Live Communications Server and the Windows Messenger Client to see the status of Polycom's IP phones, desktop and conference room conferencing products and to launch intra-company conferences from within Windows Messenger.
To enable this first link, Polycom plans to deliver software upgrades for its Media Gateway Controller and WebOffice product in the fourth quarter. The updates are likely to be available at no charge for Polycom users with a service contract, but pricing has not officially been set yet, a Polycom spokesperson says.

The second phase of the partnership, slated for next year, will include updates from Microsoft and Polycom and will add federation, allowing users to set up conferences with users outside their own corporate networks. The products will also provide a link to Microsoft's Office Live Meeting web conferencing service.

In the third phase, planned for 2006, Microsoft and Polycom plan to add control of Polycom products and Live Communications Server capabilities to other applications, including the Microsoft Outlook e-mail client and CRM (customer relationship management) and ERP (enterprise resource management) products, the companies say.

The agreement between Microsoft and Polycom is not exclusive, says Dean Schoen, vice president of corporate business development at Polycom. The company is free to seek a similar alliance with, for example, IBM – another major player in the enterprise instant messaging space.

Microsoft already has partners including Radvision and First Virtual Communications whose products offer capabilities similar to the combination of Live Communications Server and Polycom's products, a company spokesperson says. However, these companies don't have the same reach as Polycom, he says.