Telecommunications company Nortel announced that it acquired Mesa, Arizona-based developer DiamondWare, which has been working on proximity-based 3D positional voice technology.

Nortel revealed that the studio's technology will be a key component in web.alive, a new virtual world application designed to help businesses facilitate internal collaboration as well as customer and partner interactions over the web.

web.alive can be added to a company's web site, where users can control customer avatars, interacting with each other and the company's customer service avatar to make purchases, receive a product demonstration, or resolve other issues.

Business can also hold virtual web-based meetings and allow employee avatars to interact in real-time.

Said web.alive's chieft architect Arn Hyndman: "People are no longer satisfied with existing collaboration tools or with static web sites supported only by a telephone contact center as the main point of interaction. They want to discuss potential purchases with others, exchange ideas, make business proposals, and fluidly interact with others in real-time.

He added: "Additionally, web.alive will offer security not available with other virtual environments today because it is integrated with corporate enterprise systems and software."