Nortel Taps IBM Brain Trust For Product Development

As part of the deal, the two companies have set up the Nortel-IBM Joint Development Center, in Research Triangle Park, N.C. There, staff from both companies will team to extend Nortel's existing products, as well collaborate to create new products related to end-to-end broadband, voice over IP, multimedia services and wireless broadband. That collaboration initially will focus on developing a new class of blade servers, the companies said.

"This agreement with IBM is a critical component of our strategy to partner for growth," Bill Owens, Nortel vice chairman and CEO, said in a statement.

The arrangement appears to be among the first of its kind for either company. IBM, for example, has pledged to commit consultants, engineers, scientists and researchers from Business Consulting Services, Engineering and Technical Services, its Research Division and Systems and Technology groups. In effect, IBM and Nortel become design and development partners for Nortel's full-range of products in the telco and networking markets.