SAP and Its Evolving Business Model

August 10, 2009

First, the Tibco rumor and now the SAP on demand software strategy. Managing Automation’s “SAP Unveils an On-Demand Software Strategy for Large Enterprise Customers” surprised me. I had dismissed SAP’s cloud chatter as fog. Not so according to Jeff Moad, a member of the Managing Automation editorial staff. He wrote:

At a recent SaaS conference in Amsterdam, John Wookey, SAP’s executive vice president for large enterprise on-demand, said the company plans to roll out a series of SaaS products for large enterprises that integrate tightly with SAP’s on-premise Business Suite and run on the Java-based on-demand platform that SAP acquired along with Frictionless Commerce in 2006. SAP will concentrate on selling the SaaS offerings to existing users of its business suite rather than new accounts, Wookey said. SAP’s SaaS offerings for large enterprises will include some existing and some new products. Existing products include SAP’s CRM on-demand and e-sourcing services. SAP CRM on-demand will be migrated to the Frictionless on-demand platform…

You can get a consultant’s viewpoint and some verbiage from SAP top brass. For me, the article triggered three thoughts:

  1. How will SAP make up the shortfall between the revenue from its traditional approach to licensing and deploying its software and the “cloud” model?
  2. If there is strong uptake for SAP cloud services, from where will the engineers needed to service the clients come? If SAP trims down the functionality, won’t the savvy buyer look for lower cost cloud options or just fire up some coders to create a solution using Google or Microsoft functions?
  3. What will customers be getting? Will this service be a 2009 version of Microsoft’s early push into cloud computing?
  4. Whither TREX search?

I don’t have answers, and I didn’t see them in the Managing Automation write up.

Stephen Arnold, August 11, 2009

Comments

One Response to “SAP and Its Evolving Business Model”

  1. sap business one on August 25th, 2009 11:19 am

    Very cool blog.. The information possess about SAP is so good..
    Keep on updating..
    Thanks..

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