Microsoft and Packeteer have jointly developed the Packeteer iShaper, an appliance for branch offices aimed at combining WAN optimisation with Windows.

The appliance, which is expected to ship later in the second quarter, would allow branch office workers to manage and speed up WAN traffic with greater security and at lower cost, Bala Kasiviswanathan, director of Windows server branch and storage solutions at Microsoft.

Zeus Kerravala, an analyst at Yankee Group Research in Boston, said the joint marketing arrangement between the two companies gives Microsoft the ability to sell additional servers to customers attracted by Packeteer's acceleration technology. "It's incremental for Microsoft, and any box Packeteer sells is the upside for Microsoft," he said.

But Riverbed Technology is the leader in the application acceleration space and has outdone Packeteer in the past two years, Kerravala said. Citrix Systems also competes in that market.

"Packeteer had their chance after 10 years in the market and let Riverbed walk right over them," Kerravala said. "And you can quote me on that."