Microsoft to acquire software maker Groove Networks

IHT - NY Times: "Microsoft said Thursday that it was acquiring Groove Networks, a leading maker of collaboration software, and naming its founder, Ray Ozzie, one of its chief technical officers. Ozzie, a creator of Lotus Notes, will report directly to the Microsoft chairman Bill Gates and continue his work with the Groove team.

Founded in 1997, Groove has worked closely with Microsoft for nearly five years. Groove's software allows workers in far-flung destinations to work together better by letting them create "virtual offices" outside of their actual workspaces.

Ozzie joins technical officers David Vaskevitch and Craig Mundie as executives who work directly with Gates in planning Microsoft's strategy. Ozzie has become a Microsoft ally in recent years by making Groove products work with the company's software and by backing Microsoft during a lawsuit over an Internet patent.

Ozzie founded Iris Associates in December 1984 to work on the product that was bought and sold by Lotus Development as Lotus Notes, Ozzie said on his Web site. International Business Machines bought Lotus Development in 1995.

The acquisition will bolster Microsoft's strategy of expanding its Office franchise beyond familiar products like Microsoft Word and Excel. With the market for those products growing more saturated, the company has been looking for new ways to make money from business software, including introducing Web conferencing software and getting into the market for corporate instant messaging.

After the deal is completed, the nearly 200-person Groove organization will continue to operate from its headquarters in Beverly, Massachusetts. "