Microsoft Corp. described wide industry support during the formal announcement of Office Communications Server in San Francisco on Tuesday.

Despite the potential to compete against portions of the software, available today, companies like Nortel Networks Corp. and Telefonaktiebolaget LM Ericsson said they've partnered with the software giant to deliver products that will run on the OCS unified communications system.

They join a total of 50 partners including Asus Computer GmbH and NEC Corp. that are making products like USB (Universal Serial Bus) phones using Microsoft OCS software.

SAP AG said it will integrate OCS's presence and click-to-call functions into Duet, software that lets end users access SAP data and capabilities from within Microsoft Office. Eleven other software developers said they're integrating OCS functions into their products.

Dell Inc., Nortel and Microsoft said they'll work closely together to deploy unified communications software for businesses.

Microsoft also said that 155 companies, including Gibson Guitars, Global Crossing Ltd. and Expedia were part of the OCS early adopter program, using the system to save money on IT costs and end-user costs.

Microsoft says that delivering voice telephony on software will spur new developments. "Once software gets into the mix, the capabilities can go way beyond what everyone thinks of today when we talk about the phone call," said Microsoft Chairman Bill Gates.

The way to add value to today's voice systems is to bring in third parties, but the way systems are currently set up doesn't allow for that, he said.

He called OCS a "complete transformation of the business of the traditional PBX. In some ways the PBX is what the mainframe was many years ago, when all the functionality was in one place," he said.

Eventually, the lowest cost structure will be to have no PBX, to only rely on software for voice services, he said. But in the meantime, companies can evolve by using a variety of combinations of PBX and other traditional voice hardware and software components, he said.

"The transformation of software being communications is going to be as profound as the shift from typewriters to word processors," Gates said.

OCS is a unified communications software platform putting Microsoft in competition with companies like Cisco Systems Inc. that provide communications systems to enterprises. End users of OCS will be able to make calls and see presence information about co-workers from within software applications on their PCs. They'll also be able to easily start up collaborative sessions, including videoconferencing.

The IDG News Service is a Network World affiliate.