It is often argued that the volatility of competitive environments can make an independent approach to new product development (NPD) impracticable, time-consuming and costly. Therefore, organizations are increasingly recommended to develop new products and services collaboratively through alliances, for example, in R&D, marketing or production. Discussion and research have tended to focus on the benefits of such collaborative strategies and have tended to under-estimate the problems and costs involved. There are also unresolved issues in the collaboration literature which raise important questions about the operational and strategic benefits claimed for collaborative new product development (CNPD). This paper addresses the issues surrounding the costs of collaboration by reporting recent empirical research in UK technology markets aimed at examining the risks and rewards experienced by UK companies following CNPD strategies. The research suggests that careful management is necessary to achieve the potential rewards of collaboration. The paper concludes with some discussion of the possible implications of these empirical findings for the theory and practice of CNPD.