Microsoft plans to introduce early next year an upgraded integrated-communications client that provides real-time collaboration capabilities by combining instant messaging, presence, audio- and videoconferencing, telephony, and application, data, and file sharing.

Introduced at the Voice on the Net conference in Boston on Tuesday, the client, known as Istanbul, is aimed at the business market and designed to work with a new version of Microsoft's Live Communications Server, which will be released in a few weeks. The communications-and-collaboration system can serve up to 100,000 users. Microsoft plans to release the software in the first quarter of 2005.

"This is the first client to deliver on the promise of universal connectivity," says Andrew Sinclair, director of live communications in the Real-Time Collaboration business unit at Microsoft. The software lets PC users control just about every type of communication used by businesses with just a few mouse clicks, rerouting or forwarding phone calls from an office phone to a mobile phone to a home phone, or quickly setting up audio- and videoconferences and IM chats.

"The whole thing pivots around presence," Sinclair says. "We really should be communicating with people rather than devices." Many instant-messaging clients can show whether a person is at his desk working on a computer. Microsoft's new client can be used to provide additional information, such as "in a meeting" or "on a phone call," and to direct communications and messages to another location or device.

The client also will be integrated with Microsoft Office applications so people can make use of the communications and collaborations capabilities without having to switch to another application. It also will work with PBX voice systems from many vendors and a variety of conferencing services.

The client "sounds very promising," says Genelle Hung, senior analyst with the Radicati Group, a research firm. The combination of instant messaging, telephony, presence, and Web conferencing is "really what information workers and power users will most likely need and want to use."

The big challenge, she says, is the design of the client and getting workers to start using a new type of application for communications. "The problem is getting information workers to get started on something new like this, which is the problem with all new technology," Hung says. "If it is poorly designed and users don't realize the potential, then it will be virtually worthless."

Business will be able to link and extend, or "federate," their collaboration and communications systems with each other so workers at each firm can communicate with each other in real time, Sinclair says. "But we will have lots of controls so businesses can restrict what is shared," he says.

Microsoft says it's seeking beta testers for Istanbul.