Sep. 24--Cisco Systems today will announce an update to its suite of products used for business communications, intensifying its battle with Microsoft in that growing market.

Joe Burton, chief technical officer for unified communications, said Cisco is improving the products' interoperability, integrating TelePresence -- a virtual meeting experience -- with its customer service software, and adding instant messaging and other new features to its online conferencing known as WebEx.

Zeus Kerravala, an analyst at Yankee Group, said Cisco is the first to offer unified communications as a real software service. "It does heat up the competition between Cisco and Microsoft," he said. "Unified communications" refers to the technology that is needed to deliver voice, video and data on land-line and mobile networks.

Cisco has been bulking up its communications products, buying WebEx for $3.2 billion in March 2007, PostPath, a provider of e-mail and calendar software, in August for $215 million and Jabber, which offers instant-messaging software for corporations, earlier this month. "We think we have absolutely the strongest position of anybody out there," Burton said.

WebEx, the leader in Web conferencing, competes directly with Microsoft's Live Meeting.

"The acquisition of Jabber solidified its move against Microsoft," said Melanie Turek, an analyst with Frost & Sullivan. "There is no doubt Cisco is trying to piece together a complete

communications suite."

Turek said the improvements in interoperability, particularly with products made by competitors like IBM and Microsoft, will please customers. "What we hear from users and IT managers is interoperability and integration is their No. 1 priority," she said.

Unified communications makes up only a fraction of Cisco's annual revenue of $40 billion. It is counted as part of the "advanced technology" segment, which makes up 25 percent of total sales. But Cisco believes unified communications represents a $34 billion market and is one of the keys to the San Jose company's continued growth.

Contact Elise Ackerman at eackerman@mercurynews.com

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