AT&T Corp said on Friday it has teamed up with chip giant Intel Corp to work on research and development and produce products together.
Both companies declined to disclose how much they are investing in the initiative.
The alliance comes at a time when telecommunications is increasingly converging with computing. For instance, Voice over Internet Protocol is gaining in popularity as a means to make phone calls via the Internet.
As part of the agreement, which was signed six months ago, Intel will work together to produce a chipset that will allow AT&T to create services over Internet protocol.
For example, the chipset, which could find its way into cell phones, personal digital assistants and set-top boxes, would allow users to click on an AT&T icon to do things like make phone calls via the Internet. AT&T researchers are developing a device dubbed "Office in a Box" which would allow small and medium-size businesses to gain access to data and voice services all in one place.