Microsoft News Tracker

John Letzing at MarketWatch reports that Agere Systems Inc. has sued Microsoft for allegedly misappropriating trade secrets related to VoIP technology:

In a complaint filed in U.S. District Court for Eastern Pennsylvania on March 15, Agere claims that Microsoft gathered confidential information during meetings in 2002 and 2003 related to Agere’s sound technology used for Internet videoconferencing, because Microsoft was interested in licensing and acquiring that technology.

Just prior to the anticipated signing of a licensing and transfer agreement, however, “Microsoft abruptly terminated the negotiations, proclaiming it had a ‘breakthrough’ in its own undisclosed development effort,” Agere says in the complaint. Agere says the “breakthrough” was made by Microsoft researchers who had reviewed proprietary Agere materials, and was later used by Microsoft to develop its own products.

Microsoft had no comment and an Agere spokesman offered the observation that Microsoft may be infringing on Agere patents as well.

In a nutshell, a beta of Speech Server 2007 will be released in May with the product release planned for late 2006. If you aren’t familiar with Speech Server 2007, it’s “Microsoft’s next-generation speech and telephony platform to help contact centers and businesses meet the challenge of reducing costs while improving automated customer service over the telephone.” Just think of it the next time you hear “Your call is important to us.”

The press release has more details on what is new in Speech Server 2007 including support for SALT, VoiceXML, and VoIP plus new analysis tools and a new .NET API. As for the bottom line:

Over the past two years, Speech Server 2004 has been embraced by more than 100 customers in the United States and Canada. More than 40,000 telephony ports of capacity have been licensed, and Speech Server customers are successfully answering more than 10 million calls per month on the platform.

Seems like a comfy niche.

Microsoft and Cisco together:

Today, at the VoiceCon 2006 conference, Cisco Systems and Microsoft Corp. announced they are working together to provide collaborative real-time capabilities for businesses through the integration of Microsoft® Office Communicator 2005 and the open Session Initiation Protocol (SIP)-based Microsoft Office Live Communications Server 2005 with the new SIP-based Cisco Unified Communications system.
…
The new communications solution from Cisco and Microsoft will allow customers to do the following:

• Click to call as well as transfer phone calls from Office Communicator, eliminating the need for users to act as human middleware

• Launch or answer a phone call from within Office Communicator, and choose to conduct the call from a computer or a desk phone

• View Cisco Unified IP Phone presence status from within Office Communicator, providing users with an expanded view of presence information

• Transparently escalate between Office Communicator instant messaging and voice sessions, enabling users to communicate more effectively
…
This phase of the Cisco and Microsoft interoperability solution is expected to be generally available in August 2006 for new installations and upgrades to existing customers.

But Cisco isn’t Microsoft’s only partner:

Today at the VoiceCon Spring 2006 conference, Microsoft Corp. announced growing industry support for Microsoft® Office Live Communications Server 2005 as a hub for unified communications solutions that provide rich capabilities to allow people, teams and organizations to communicate simply and effectively while integrating seamlessly with business applications and processes. Microsoft is focused on extending the rich capabilities of presence and people-centric communications to encompass voice and apply the power of desktop software and software platforms to improve and advance communications.

To this end, Microsoft is collaborating with telephony companies to enable further integration between business desktop phones and the rich collaboration environment on the PC, allowing customers to more effectively communicate in real time. Microsoft is working with Alcatel, Avaya, Cisco, Mitel, NEC, Nortel and Siemens to enable Session Initiation Protocol (SIP)-based interoperability between voice communications solutions and Microsoft Office Communicator 2005 and Microsoft Office Communicator Mobile, the PC and mobile phone unified communications clients for Live Communications Server. The solutions will enable business customers to launch and answer private branch exchange (PBX) and Internet protocol-PBX (IP-PBX) phone calls and view phone presence state from within Office Communicator. They also allow customers to seamlessly switch between instant messaging and voice sessions.

And Microsoft isn’t Cisco’s only partner:

Cisco Systems is bundling up its tools for all kinds of communication in enterprises and giving the set an appropriately broad brand name: the Cisco Unified Communications system.

The range of products covers voice, e-mail, text, collaboration, and videoconferencing capabilities, as well as the ability to reach the right person on the first try on matter what device they are using through presence technology. It builds on Cisco’s current lineup offered under the IP Communications banner, namely its CallManager, Unity, MeetingPlace, and IP Contact Center products, and adds three major new software products as well as new features.

More details by following the link, but here’s the nut:

Though it is still immature, SIP will emerge as a glue that will let enterprises combine communication platforms and applications from many vendors, said Forrester Research analyst Elizabeth Herrell.

“SIP is going to force these vendors to stop being so proprietary,” Herrell said. Cisco and other network players are emphasizing overall systems but they are also open to cooperation with software vendors such as Microsoft and IBM, she added.

“They want a common platform, but I’m not sure all the applications on that platform will be theirs,” Herrell said.

The San Jose, California, company also is deepening cooperation with Nokia for mobile IP calling at enterprise sites, allowing a softphone client being developed by Nokia to register as a client on CallManager. This will let employees use the softphone as they would a conventional enterprise phone, with features such as four-digit extensions.

Randy Cook, director of global voice networks at Oracle, welcomes Cisco’s adoption of SIP for call control. Use of the standard, instead of a proprietary protocol used previously, will allow for tighter integration with third-party software such as Oracle’s own applications, he said.
…
Another good move on Monday will be the introduction of CallManager on a Linux-based hardware platform, Cook said. The appliance will run a hardened version of Linux based on a Red Hat’s distribution of the open-source OS. He would like to move the software off Windows to a more stable OS that is less plagued by viruses, he said.

It looks like anyone’s game at this point and everyone is playing.

That’s the story from Tony Glover at the UK’s The Business online:

Microsoft has developed a Skype-style free internet voice service for mobile phones that City analysts believe could wipe billions off the market value of operators such as Vodafone.

The service is included in a mobile version of Microsoft Office Communicator due to be released this year. It will take the form of a voice-over internet protocol (VoIP) application that allows Office users to make free voice calls over wi-fi enabled phones running Windows Mobile software. It uses the internet as a virtual phone network as well as accessing e-mail, PowerPoint and other Office applications.

Microsoft chief executive Steve Ballmer dropped his bombshell at the mobile operators’ annual 3GSM show in Barcelona last week. The significance of his remarks was missed because of his effusive and eccentric delivery.

Ouch! Ballmer demonstrated a VoIP call during the keynote and VoIP was also mentioned briefly in the press releases, but I guess it took a while for the implications to sink in.

Cyrus Mewawalla, an analyst at Westhall Capital, believes VoIP, when backed by Microsoft, will have a more devastating effect on mobile operators than it did on the fixed-line operators, which saw their voice revenues slashed after the introduction of VoIP services such as Skype.

“Internet voice does not even have to take market share to force traditional operators to cut their prices. The mere thought of free voice is enough to make customers push for price cuts,” said Mewawalla, predicting a bloodbath for mobile operator stocks.

More by following the link, but the initial effect may be limited by Office Communicator’s target business audience.

Update 2/20: Mark Odell and Kate Mackenzie from the Financial Times have more in Internet telephony set to go mobile:

“Internet voice is going mobile,” said Jorma Ollila, Nokia chief executive, on Monday as the world’s biggest maker of mobile handsets unveiled its first mass- market model capable of supporting voice-over-internet protocol. VoIP is the emerging technology that offers cheap calls to users by routing them over the internet, instead of traditional phone networks.
…
About a dozen large mobile operators are “actively” looking at offering VoIP-based services, according to one senior industry figure.
…
Microsoft is increasingly moving into mobile software and its Windows Mobile operating system already supports VoIP.

The latest version of software developed by Symbian, 48 per cent owned by Nokia and currently the biggest supplier of operating systems to high-end mobiles, will do the same.

As a stand-alone mobile operator, Vodafone is seen as being more exposed to the inevitable pricing pressure than some rivals.

However, the UK-based operator accepts it is inevitable. “We have to morph from where we are now,” said Arun Sarin, chief executive of Vodafone. “That [VoIP] is clearly a world around the corner . . . it is two to three years away.”

After Microsoft acquired VoIP technology company Teleo last August, there was lots of speculation about Microsoft’s VoIP plans. Olga Kharif at BusinessWeek provides a detailed update on the current state of play in Voice over Microsoft Protocol? Some excerpts:

Microsoft has yet to make public its plans for Teleo, but BusinessWeek Online has learned that the software maker plans to weave Teleo’s bells and whistles into a number of applications, such as Hotmail and instant messaging. Microsoft also hopes to integrate VoIP into its new paid-search platform, which is being rolled out worldwide, as well as a planned classified-ad service.

The VoIP efforts are aimed at gaining traction in online advertising, where growth has been stunted by the outfit’s anemic Web-search share.

Ouch, but it’s true. Not to mention the slow roll out of adCenter.

Other parts of MSN are under pressure, too. Visits to MSN’s Instant Messenger site, where users can download Microsoft’s IM software, have dropped since the summer, according to Web consultancy Hitwise.
…
VoIP entrepreneur Jeff Pulver says Microsoft is losing IM users to Skype. Traffic woes were a major reason for MSN’s September management restructuring, says Matt Rosoff, an analyst with consultancy Directions on Microsoft.
…
As Microsoft tries to fight back, VoIP will be one of its major technology weapons this year. The software giant will roll out the various VoIP capabilities between February and August, sources tell BusinessWeek Online. Brooke Richardson, Microsoft’s group product manager at MSN, confirms that the company is considering adding VoIP functionality to many of its applications and services. “Voice is becoming not a nice-to-have, but a must-have” feature, she explains.

Here’s how it’s expected to work. Microsoft will add PC-to-phone calling capabilities to its IM and e-mail services. That means Hotmail or IM users, for instance, will be able to place calls directly from their e-mail or IM address books. Microsoft plans to introduce Windows Live Messenger, or LM, offering such features this year.
…
Finally, VoIP technology will come in handy as part of Windows Live Expo, an upcoming classifieds service from Microsoft that’s expected to jump-start an era of social-networked search.

Much more by following the link. I don’t believe VoIP is sufficient for a turnaround, but Microsoft will surely need it to get into the game.