"We're trying to lower the threshold at which smaller companies will start to use high-value technology from both companies," Peter Alexander, vice president of the worldwide commercial market segment at Cisco, said at the Cisco Partner Summit in Honolulu.

The two vendors said they are developing reference architectures, available to qualifed partners of both companies in April 2004, that will make it easier for solution providers to perform joint installation of their products.

The companies are also integrating Cisco's CallManager and CallManager Express IP communications software with Microsoft CRM.

The new integration will give channel partners a way to position IP telephony as a high-value applications sale, said Gia McNutt, CEO of Special Order Systems, a solution provider in Rocklin, Calif.

"CRM is great but without the telephony integration, it's missing something," she said.

The vendors are also developing a product bundle that joins the Cisco 831 Broadband Router and Microsoft Small Business Server 2003 Standard Edition.

The SBS/router bundle should save customers 20 percent to 30 percent compared with the price of buying the pieces separately, Alexander said.