Technology alliances, particularly those in the telecommunications sector, do not have a very good track record. Many like Alcatel's one-time partnership with Cisco, never really got off the ground while others, like BT's long-dead Concert partnership with AT&T fell apart at the first hurdle.

But Microsoft, the world's largest software group, and Nortel, the Canadian telecommunications equipment maker, are betting their one-year old strategic partnership, dubbed the Innovative Communications Alliance, will continue to beat the odds.