Eye on Oracle

Mar 21 2007   7:44AM GMT

SAP changing its tune on SaaS?

Beth Pariseau Beth Pariseau Profile: Beth Pariseau

An article published in Enterprise Systems at the end of 2006 predicted five major trends for enterprise IT in 2007, and the first one was Software as a Service (Saas). The article notes: “Joining pioneers Salesforce.com, NetSuite, and others, Oracle Corp., Business Objects SA, Informatica Corp. […] announced new SaaS offerings or expanded existing on-demand services.” SAP AG, Oracle’s arch rival in the enterprise apps space, wasn’t mentioned in this section.

According to IT blogger Nicholas Carr at Rough Type, that’s because SAP has for the most part dismissed rather than embraced SaaS as a model. He links to a CNET interview conducted last April in which SAP CEO Henning Kagermann deems on-demand a limited technology: “You can do this on-demand for certain areas and certain functions, but not for everything.”

SAP now seems to be singing a different tune. Kagermann recently touted the advantages of its suite of SaaS applications, codenamed A1S and yet to be released, as “game-changing” and “the better model.” This switcheroo, says Carr, is “spurred no doubt by his firm’s recent earnings shortfalls.”

Blogger Vinnie Mirchandani is more skeptical: “Read it closer, Nick. He means better model for SAP.” In other words, SAP’s latest claims about SaaS are just PR?

Matt Danielsson offers another take on where SAP stands on SaaS. “It seems SAP has made a 180 degree turn, going from ‘Bah!’ to ‘Wow!’ in just a year,” he says. But “it’s hard to predict the future when all you have is powerpoint slides and grandiose presentations. A1S might blow us away, or it could be another underwhelming experience a la CRM On Demand.” Only time will tell . . .

-Elisa Gabbert,
Assistant Editor

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