Microsoft/Nortel UC relationship in peril?

Nortel's bankruptcy filing on January 14 may put the breaks on its high-profile unified communications relationship with Microsoft.

In November the two companies said their four-year Innovative Communications Alliance (ICA) to develop, sell, and roll out UC and VoIP technology to the enterprise was "solid and intact," said Network World. However, yesterday's Chapter 11 bankruptcy filing raises questions about how long the deal will last.

Microsoft has to be concerned, since Nortel is currently more worried about staying alive than investing in new product development.  Further, analysts say that Nortel's large base of VoIP customers is vulnerable to competitors looking at the chance to steal the business. The next 90 days of corporate activity, coupled with how Nortel communicates with its existing customers, will be critical to the relationship. 

Microsoft is publicly taking a wait-and-see stance until it gets a better look at Nortel's financial reorg plans. The ICA UC deal is set to expire in 2010, but the bankruptcy courts or Nortel executives may be forced to take more drastic measures before then.

Nortel may try to salvage what it can of the Microsoft relationship, since it gives them a foothold into the growing market of UC and lines up with Nortel's enterprise customer base. But talk of "business as usual" by Nortel execs has a sense of déjà vu all over again, and any sales of assets to provide operating capital for other operations just went into the bargain-basement bin.

For more:
- Network World thinks about the Microsoft/Nortel UC deal. Article [1].

Related articles
Nortel files for bankruptcy [2]
Nortel's (latest) crash - FierceVoIP [3]