Microsoft Corp has made it up with Cisco Systems Inc, and signed Cisco up as a licensee of its Active Directory, the directory services set to appear with the next major release of Windows NT (CI No 3,156). As part of the deal, Cisco and Microsoft will jointly develop extensions to Active Directory, integrating advanced network management features, and tying it more closely together with Cisco’s IOS Internetworking Operating System. The aim is to merge the Microsoft Windows NT world together more effectively with communications servers from Cisco. And as part of its IOS integration, Cisco will also be porting Active Directory to various Unix platforms, for the benefit of its existing telecommunications customer base, where Unix is still the norm. The deal is the first third party deal Microsoft has struck for the Active Directory, and is a blow for Novell Inc, trying to establish its own Novell Directory Services as an industry standard. But potential conflicts between the two companies could arise in the future. Microsoft Corp is working on a project, codenamed Steelhead, which aims to put router functionality within Windows NT itself, thus putting itself directly in competition with Cisco.