IBM vs. Microsoft -- place your bets

Yesterday, there was news of two initiatives International Business Machines Corp. (NYSE:IBM) is involved in that may put pressure on Microsoft Corp. (NASDAQ:MSFT).

First, IBM joined forces with rivals Intel Corp. (NASDAQ:INTC) and Hewlett-Packard Co. (NYSE:HPQ). It is expected the companies will announce a new Linux cooperative, the Linux Foundation, that would promote Linux open-source operating system. This, of course, puts direct pressure on Microsoft's Windows operating system.

The other news item was from IBM's Lotus unit. The unit will introduce Lotus Connections, a new collaboration software that combines five components: member profiles, activities, blogs, communities and "dogear." It functions like MySpace but is for office workers, providing an easier way to work together on projects. Lotus Connections will become generally available later in the first half of 2007. Pricing hasn't been disclosed.

Lotus Connections is offering the equivalent of MySpace.com or Facebook, Yahoo Inc.'s (NASDAQ:YHOO) bookmark sharing site del.icio.us and a blog search tools like Technorati.com. These are combined in one package, which could be seen as a renewed challenge to Microsoft and other competitors such as Oracle Corp. (NASDAQ:ORCL) and Adobe Systems Inc. (NASDAQ:ADBE).

Last year, IBM said Lotus Notes had 125 million users. This could rise to 150 million with the collaboration software. Microsoft has 200 million Outlook users and signed up another 80 million licensed users of SharePoint software, according to a Burton Group analyst, who also thinks corporations might reconsider Lotus Notes following these enhancements.

It's good to see IBM busy, but I'm sure Microsoft isn't going to sit idly by and just let things happen.