Microsoft and Sun are creating a technology and IP licensing framework to drive increased interoperability between Windows and Solaris clients and servers, and Java and .NET.

Cooperation will initially center on Windows server and client, extending to e-mail and database, and include interoperability between authentication and authorization systems.

Microsoft has paid Sun $350m in up-front royalties to license Sun’s technology while Sun has agreed to join Microsoft’s Communications Protocol Program (MCPP).

Championing the deal Friday, Sun chief executive Scott McNealy said the deal is attractive to developers and ISVs because increased interoperability would help win more customers for platform vendors Sun and Microsoft. Developers want volume, McNealy said.

Commenting on the deal, Borland Software Corp’ vice president and general manager of Borland’s Java business group George Paolini welcomed interoperability, saying it increased the potential business opportunity for Borland.

Dean Guida, CEO of Java and .NET component author Infragistics Inc, said interoperabilty would help organizations re-use Java skills to build .NET applications. Guida is enthusiastic about the potential for Visual Sutdio.NET to be used as a front end to build Java applications.

There’s a great opportunity to take [Java] skills and move middleware and business logic to the .NET platform. This gives organizations the opportunity to leverage their skills, Guida said.

The deal between Microsoft and Sun, though, potentially threatens ISVs involved in enterprise application and data integration, because the platform vendors are promising to share more and more of their hitherto hidden client, server and application APIs.

Also in question is the continued need for the Web Services Interoperability (WS-I) organization, whose raison d’etre is interoperability between .NET and Java specifications.

Commenting on the potential threat to EAI and data integration vendors, in a press event with McNealy, Microsoft chief executive Steve Ballmer said: Neither of us thinks this is a bad thing that money spend on custom engineering can be taken out.

McNealy drew on his famous big-friggin’-web-tone switch metaphor for systems, which he uses to describe the level of reliability and utility required from hardware and software. There’s no such thing as the integration industry and middleware companies in the telco industry, McNealy said.

Paolini believes the degree to which the collaboration between Sun and Microsoft effects the integration industry will vary according to the level of co-operation between the two companies, and the types of technology that are interchanged.

He estimated a negative impact could be felt in the long-term, after 18 months, but noted during that time integration vendors and organizations like the WS-I are still needed to deal with an existing set of integration problems brought on by the existence of legacy software infrastructure.

Taking the spin off of Friday’s announcement between Microsoft and Sun, Paolini said: [They] have to figure out what they are sharing, then they have to built it and they have to propagate it.

This article is based on material originally published by ComputerWire