Rimini Street, which offers technical support for end users running Oracle, SAP, and other enterprise applications, recently reported a strong first half of 2008, buoyed partly by an influx of SAP customers.Two SAP decisions are making the rest of 2008 look even brighter for Rimini Street. First, SAP decided to increase SAP support pricing so that all end users will eventually have to pay 22% of license revenue for support. Secondly, SAP decided to close TomorrowNow, a Rimini Street competitor.
To those SAP users up in arms about the increase in the cost of SAP support, Rimini Street is offering a simple value proposition: “We will charge you 50% of what you’re paying your vendor for support,” says Dave Rowe, VP of Marketing with Las Vegas-based Rimini Street. Anecdotally, Rowe notes that many SAP users have already reached out to Rimini Street to learn more. “The phone is ringing off the hook,” he enthuses.
SAP’s angle, which new SAP Executive Board member Bill McDermott reiterated for SearchSAP yesterday, is that the increased price of support simply reflects a higher level of SAP service. Even so, some SAP users will not be needing that level of service and will consequently look to shave off the cost of support by migrating to providers such as Rimini Street. For its part, SAP may have little choice in raising the cost of support, as this is part of a margin war with Oracle and other enterprise applications software providers. Anyway, if SAP end up losing support customers, it could always buy Rimini Street — although, after the bitter pill of the TomorrowNow acquisition, any such move is probably unlikely.
Demir Barlas, Site Editor