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SAP TechEd 2008 - Awesome, Entertaining, Underwhelming

SAP TechE2008 at ICC BerlinI've just arrived back from a very enjoyable 3 days in Berlin at SAP's TechEd 2008 conference. The theme was "Connect, Collaborate, Co-innovate" and I could see plenty of connections, some good examples of collaboration, and one stand-out example of co-innovation (called ESME - more on that in a later post). It started with Community Day, a multi-threaded not quite "unconference" with sessions for the SAP Developer Network and the Business Proce...

SAP's A1S becomes Business ByDesign

SAP Business ByDesignYesterday, in New York at the Nokia theatre and broadcasting across the web, SAP formally announced their new, mid-market solution, which up to this point has gone by the code name of A1S.  Bill Wohl hoped that he would be the last SAP executive to use the term, and Henning Kagerman, the CEO, then introduced SAP Business ByDesign, an on demand solution which they finally described as Software as a Service - in previous presentations they had studiously avoided using that term.  This product has been 4 years in the making, with a team of 1000 people involved.  To indicate how significant they believe this is, Henning went on to say:

"I've been in the company for 25 years now and it's the most important announcement I've made in my career to date"

Some of my Enterprise Irregular colleagues were there, and I'm looking forward to their analysis, and insights from the face to face meeting the had with Henning Kagerman.  I've just listened to the recording of the event, and so here is my own first impression, which I've already published over at blognation.

SAP's plans are very ambitious.  They say they are creating a new, volume business for SAP and describe Business ByDesign as a next generation, on-demand product, which they are combining with launching a completely new business model with an entirely new customer experience throughout the product life cycle.  That includes the ability to try before you buy, so that you can prototype a solution, which would then become your live system once you've signed the Ts and Cs and bought the product. 

They are positioning BBD as a complete solution, with no compromises, but say it is not designed with  traditional categories like finance or ERP in mind, but is more service oriented and event driven.  The solution provides end to end processes that are role based, rather than modular, with a user interface that can be tailored to a person's responsibilities.  They explained that the solution has project management functionality integrated to the financials and HR, whereas the typical mid-sized company might today use as separate PC or web based package alongside their standard commercial software.  They believe they will set a new standard for business software for mid-sized companies, and say they intend to change the on demand marketplace. 

Ian Kimbell demoed the product, and it certainly looked very flexible and function rich.  However, the screen design looked very traditional.  I didn't see any AJAX style drop downs in the interface, and the help sub-system opened in a separate environment.  It looked to me like they have missed a big opportunity to simplify the user interface, and to really take on board the web 2.0 style and characteristics of many of the current web based applications that are so well designed. 

They explained that they have 40 pilot customers, and introduced the 20 who are actually live at the show, like Stemma or Compass Pharma.  They all gave the system a glowing report in terms of how it has been received by their users.  Peter Zencke, SAP Executive Board member, explained how the system is configured by a question and answer process, and that the solution is hosted in Waldorf, delivered through the browser, uses internet compression technology, and that they are steadily working on improving performance.  He said that BBD is not for companies that have a high demand for vertically specific applications, but that they are trying to do 3 things:

  • Simplify IT
  • Significantly reduce cost of ownership - previously they have talked in terms of 1/10 of the cost of their traditional solutions, and this was repeated by Léo Apotheker, the deputy CEO, later in the presentation
  • And to exploit technology to address future business threats.

He went on to explain that BBD brings their SOA architecture and Software as a Service together for the first time.   The underlying technology uses NetWeaver, with MaxDBâ„¢ as the database (and not Oracle).   In the question and answer session they explained that it is a multi-tenant architecture, but that customers have separate databases. 

Earlier, Henning had explained the positioning of the product compared to their current range as follows:

  • SAP Busines Suite (ERP 6.0) is for companies with more than 2,500 employees  - a $30bn market where they have more than 10,000 customers in 50 countries
  • SAP Business All-In-One for companies up to 2.500 employees who need more complex, vertical market based solutions - a $10bn market
  • SAP Business ByDesign for businesses with 100-500 employees - a $10bn market where they believe their analysis suggests there are 1.2m companies which they aren't addressing with their other products
  • SAP Business One for companies from 10 to 100 employees - a $10bn market who need more tailor made solutions, where they have 15,000 customers in 40 countries

I have said before that I find this positioning problematic.  If the flexibility and ease of use is as good as they describe, and the cost of ownership is really as good as they say, surely some of their existing customers using the other products will compromise on less vertical functionality in return for a more cost effective solution.  As well as winning new customers with BBD, what will they do for their existing customers paying standard maintenance prices?  Vinnie Mirchandani asks the same question.

Léo talked through the pricing.  The full solution starts with a minimum of 25 users at $149 per user per month, with additional lower cost options for types of users using limited functionality like consultants only entering timesheets.  He also explained that they are piloting their channel approach with 20 companies now, and that they will be building up their partner ecosystem rapidly during 2008. 

An area where I was little confused was over the forecast numbers they quoted.  Previously they have said on more than one occasion that they plan to have 100,000 customers by 2010.  They have said that the jump from their current 39,000 customers will come by adding mid-market customers mostly with the new product.  At this event they talked about ramping up to winning 10,000 new customers with BBD by 2010.  Without the history of what they have said before, the story and raw numbers are very impressive.  SAP is the market leader in business applications, and the new product strengthens their position, and presents a big challenge to SaaS players like and NetSuite.  The issue is that the story has completely changed from their previously stated intent of 100,000 customers.  I'm sure this is an issue that they will be hit with by a number of analysts and commentators in the coming days.

If you want to see the whole morning's presentation including the Q&A session, it is available here.  You can find an FAQ about the product here.

On balance I think yesterday's announcement sounds very promising, and was a very significant day for the Software as a Service market as a whole.  From this initial impression, with only a short demonstration, the user interface doesn't look particularly exciting.   However, I'm sure the product will be a success, but I wonder how the new business model will co-exist with the traditional model inside the SAP organisation.  How much of an effect will it have on their existing customer revenues?


I wish I was in Atlanta

That might be a good title for a song by Little Feat, but actually I'm voicing the frustration that my Enterprise Irregular blogging chums are having fun over at SAP's SAPPHIRE 07 conference. I get the chance to join in when the show hits Vienna in two weeks, but in the meantime I have to attend vicariously through their blogs, and they're doing a great job!

Hasso blackboard keynote

Thomas live blogged SAP Chairman Hasso Plattner's keynote, whilst Dennis gave his considered opinion, and Dan thinks we have to wait and see. Dan also has the details on A1S from Hans-Peter Klaey, now the president of their SME division, and then Dennis presents his analysis. I've written twice before about the product, and their on demand strategy. Like me, Dennis doesn't see how it is going to work, and worries that we aren't being shown the new product, even though they say it is being trialled by 150 customers.

Dennis has met with a few people and teased us about what might be coming from CODA. He seems to think that there is definitely more innovation on show at SAPPHIRE 07 compared to SAP's major rival Oracle. Dan has also posted about Duet, which integrates SAP and Microsoft Office. I'm looking forward to the rest of the output.

Update: Jerry Bowles is at the bloggers corner too, and Coté of Redmonk is blogging Henning Kagerman's keynote.


SAP A1S - the game changing software on show at CeBIT

Over at Rough Type yesterday, Nicholas Carr has a post with the juicy headline 'SAP CEO calls SaaS "the better model"'. It's generated a fair amount of controversy amongst the Irregulars - I'll link to the related posts as they come out. Earlier in the year I reported my thoughts following their first pre-announcement when I asked "Will SAP A1S change the game in the mid-market?" Nicholas's post was triggered by reports of a demo of the current beta version in Hanover at CeBIT. Carr says:

"Although Kagermann appears to have been referring to mid-sized and smaller companies, the fact that he would call SaaS "the better model" - both for customers and for his own company's future profitability - represents a striking change of heart and of strategy. "

The first thing to say is "nice eye catching headline and copy, but SaaS was never mentioned by Mr. Kagermann". If you listen carefully to the recordings of the earlier announcement, or read the available quotes from the various publications since CeBIT you will see that SAP are studiously avoiding using either SaaS or On-Demand in their language. Once they use those terms, they will present the implication that their business model is the same as or other SaaS vendors. They talk of hosted, one-to-many architecture, subscriptions, selling via the Internet - all of the ingredients of SaaS, but not the acronym itself. Nicholas is trying to make his own particular point on the shift to utility computing, but isn't his language a form of misrepresentation?

However, the situation gets less clear, and the issues and questions pile up as you investigate further.

The FT reports that Mr. Kagermann said investors were nervous as the new product was coupled with a new business model. While big groups buy SAP's software for their offices, small companies will rent A1S and use it online. Installing databases meant the subscription model had big start-up costs.

"People know this is the better model. But the upfront cost means few dare to introduce it," he said. "You only start printing money later."

So here we get the source of Carr's headline. Apparently Kagermann goes on:

"We expect a new breed of consultant to help some businesses get started -- but only to get started," Kagermann said. "Once businesses have used the application, they'll get the hang of it pretty quickly."

Apparently these briefings suggested SAP aims to squeeze the new hosted offering between two of its existing products targeting small and medium-size enterprises (SMEs): All-in-One and Business One (B1). As part of the company's assault on the global SME market, A1S will target businesses with between 100 and 1,000 employees, while All-in-One will focus on companies with between 1,000 and 2,500 employees and Business One between 10 and 100.

Could users of All-in-One, which is a slimmed down version of mySAP ERP, be attracted to the new hosted application to save money?

"Let me make a comparison to the car industry," Kagermann said. "You can buy a basic car that transports you from point A to point B. But if you want to have other special features, you pay for them. That's the difference between All-in-One and A1S."

From they reported on A1S as follows:

"To drive the price down, the product must be highly standardized," Kagermann said. The need to offer a set of standardized functions, he said, also means "less choice" of options to customize the product, he added. "

"By narrowly limiting product customization and thus complexity, SAP and its partners will be able to deploy the offering much faster", Kagermann said. "Fewer consultants will be necessary, resulting in lower costs. "

According to the spokesman, Kagermann promised to give the market more details about the product over the next few months and said the company is still on track to bring A1S to market in the fourth quarter of 2007 or the first quarter of 2008. Apparently there are 150 beta customers already using it.

But the rollout of the new hosted service will not steal customers from B1, SAP's lower cost traditional offering that is also highly preconfigured, Kagermann said. On the contrary, "we expect more than 50,000 of our targeted customer base of 100,000 by 2010 to be Business One customers," he said.

If you piece these ideas together, none of the questions I asked in my earlier piece have been addressed. If anything I've got more questions:

  1. If SAP are segmenting the SME market by size with B1, A1S and then All-in-One, and if the product in the middle band has significantly lower cost of ownership, reduced consulting and quicker implementation, why would customers buy the other two products? The car comparison works comparing SME requirements against a larger enterprise, but doesn't work within the SME space as they've defined it.
  2. How will the A1S business model fit within the normal SAP culture and alongside the 3 other traditional products?
  3. SAP have 39,000 customers to date. How are they going to get to 100,000 customers by 2010? Even more importantly, how are over 50,000 of those customers going to be B1 customers? I just don't see how they are going to get there from here.

Other Irregulars views (added as they post):

Vinnie wonders who this is a better model for.

Dan Farber picks up on Kagermann's car comparison and SAP's quest to add 60,000 customers by 2010.

Phil Wainewright wonders Has SAP converted to SaaS? But he recognizes Kagermann and SAP are traditional software at heart, and questions how A1S will thrive in there. 


Learned words from Gartner on the SaaS market

I've just seen a press release from our friends at Gartner, trailing their Gartner Outsourcing Summit, March 19-21 in Dallas. They say the worldwide SaaS market reached $6.3 billion in 2006 and is forecast to grow to $19.3 billion by year-end 2011. There were a few quotes I just had to pick out.

At one point Ben Pring, research vice president for Gartner, says:

"There is now a widespread consensus among the movers and shakers of the IT industry that SaaS is an important and meaningful issue which can no longer be regarded as the 'lunatic fringe'."

Well I have to admit, it has felt like that at times over the past few years, but it's nice to hear that us SaaS evangelists are taking over the asylum.

The other key message is a recognition that the scale of change for traditional software vendors is too hard for many of them to manage:

"Due to the law of large numbers, traditional IT solution models are becoming victims of their own success, while the relative smallness of new approaches facilitates growth much more easily," said Mr. Pring. "For large, established IT solution providers, the SaaS market so far hasn't appeared to have enough incremental growth potential to meaningfully contribute to revenue growth. As a result, they have tended to ignore it. This has left the door open for smaller, newer players, who are now pouring into this gap. Incumbent IT solution providers are slowly waking up to this and are entering the market to leverage SaaS market interest."

This is exactly why the likes of Sage originally trailed their Sage Hosted Online 50 product way back in November 2005, but didn't formally announce it till last month - 15 months later. In the end, it isn't actually a Software as a Service approach, but their existing Windows product hosted with Citrix technology. Others are using this approach, but surely these are just stopgap solutions which can't give the kind of benefits of the full SaaS approach. Gartner's definition of SaaS is as follows:

"SaaS is hosted software based on a single set of common code and data definitions that are consumed in a one-to-many model by all contracted customers, at any time, on a pay-for-use basis, or as a subscription based on usage metrics."

It's the one-to-many model that provides the opportunity for economies of scale that can be shared by the user community and provide a better Total Cost of Ownership. Watch out for the Financial Software as a Service Manifesto, coming soon on AccountingWEB. 

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Sage finally go hosted

Yesterday Sage (UK) Limited finally announced the release of Sage 50 Accounts Professional Online 2007, its first move into the hosted accounting software market, although it was first mentioned by them as long ago as 2005.  Their press release says that recent Sage research revealed that more than a third of customers would be interested in having the ability to access Line 50 over the Internet, as well as have shared access with their accountant.
Greg Ford, managing director, Sage (UK) Limited Accountants Division adds:
"We believe in listening to our customers and they are telling us that they would like to see the benefits that hosted accounting software can bring to their practices and their clients."
I'm delighted to hear Sage corroborating the concept of shared access to accounting systems, and the kind of benefits it can bring to collaboration between the SME/SMB customer and his/her accountant advisor.  However, I'm completely under whelmed by the announcement.  I'm prepared to listen, but it looks like it fits perfectly in to Phil Wainewright's definition of SoSaaS - Same old Software, as a Service.  In his post Phil says:
"Conventional application software simply isn’t built for the on-demand model."
Pricing starts at £75 a month, and unlike most true SaaS providers who let you leave their service at a month's notice, you have to make a minimum 12 month commitment.  I'll be very interested to hear  what technology they've used to web enable Sage 50, and more details on how the licensing works. 
Over in the Netherlands, my friends at Twinfield tell me that Exact, the market leader for on-premise accounting software for SMEs over there made this kind of move some while back with a hosted version of their normal software.  After a couple of years without much success they did a complete re-write and came out with a properly architected web based solution, which is doing much better.
Overall, however, I'm delighted that Sage will put more focus on the online accounting topic in the UK, which has to be good news for those of us that are already in the market. 
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More on Vista and Microsoft's current challenge

Yesterday I posted about Windows PC vs. Mac, as well as Windows XP vs. Vista.  In several places I've seen a quote from eWeek that says:
"Only 15 percent of today's computers are capable of running Windows Vista Home Premium, considered to be the mainstream consumer version, according to Gartner."
So although people buying new PCs from today will probably get Vista, only a minority of us have PCs up to this point that are capable of running the new operating system.  Over at John Wilson's blog he adds: 
"What's more interesting to me is the notion of launching a product that you immediately preclude 85% of the market from using.  Sure, people will upgrade the computer eventually and when they do perhaps it will ship with Vista but that's a long rollout cycle."
"Whilst Vista undoubtedly makes Windows somewhat sexy again, I wonder if this is the moment when MS really stumbles as a consumer product"
Back in December, Gartner's Vista - What Next blog says this:
"The bottom line is the UI in Vista is certainly different, but not necessarily better or worse than the Windows XP UI. The look and feel are a refreshing update, and will help more novice users navigate their digital world. Experienced users will find the UI equally interesting, but will grumble about having to re-learn some features and adjust how they work with their PCs today."
You should go and read John and Fred's posts, which come at this from a VCs point of view, but it adds weight to my decision to stick with the Windows XP Pro that I've got, even though I'm in the 15% that have 1Gb of RAM and a dual core processor and are Premium (or even Ultimate) capable. 
Roger Ehrenberg has detailed analysis, and some excellent insight in to where this leaves Microsoft.  He suggests:
"And I've got to say that this latest leg in the Microsoft/Apple battle bears stunning similarity to the duel (although it is hard to have a duel when one of the participants is already dead) between Sony and Nintendo in the PS3/Wii war, while a story that still needs to be fully played out looks increasingly like the nimble, adaptive, consumer-focused company kicking the crap out of the Grand Dame of Gaming. And I am sure over the ensuing months and years we will see more of this stuff happening, where the more consumer-centric, lighter, friendlier applications will dominate the legacy titans of yesteryear. It is all just beginning, and the first and highest profile casulty may well be Sony, closely followed by Microsoft. Anyway…"
It's a long post, which you have to go and read, but in his conclusion he suggest that we may be witnessing an historic changing of the guard, and compares the situation with my old firm, IBM, back in the 80s.  I can see why he makes the comparison with the complex, red tape filled IBM organisation of that period.  However, from the people I've met at Microsoft, I can see a lot of innovation away from their desktop heritage.  They may need to slim down to a leaner company like IBM did, but I'm sure they'll still be a significant player in the new era where the web rules rather than the desktop. 
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Open Source and other "cool" stuff from SAP TechEd

SAP TechEd '0k at Amsterdam RAIEarlier I posted my impressions of the new SAP, my thoughts on SDN, and Shai Agassi's keynote presentations.  My overall impression is that I met some very smart people with good ideas and learned a lot. 
One of the smart people was Chris Hearn, Product Marketing Director.  SAP are keen to emphasise their openness, and open source credentials.  Their NetWeaver development platform embraces Java and .NET, as well as handling their ABAP proprietary language.  More than once at the show I heard mention of the fact they were the first enterprise software company to achieve Java EE 5 Certification - I'm not sure what that means, but it's to do with keeping up with standards, which must be good.
We had a fascinating conversation with Chris where he used SAP's dialogue with the Venezuelan government to discuss Open Source.  Apparently through a combination of revolutionary thought and anti-US feeling, there is a big, government mandated shift away from proprietary software from the likes of Microsoft and SAP.  This has culminated in an open source law coming in to effect last January, which has decreed a two year transition to open source in all public agencies, although it also covers their oil industry (which accounts for 70% of the country's economy).  With a little further research I now see the "software libre" movement is happening in Brazil, Chile, Cuba and Argentina too, all with the aim of saving government departments millions of dollars in licence fees.  In Venezuela, if you want to install anything that isn't open source, you have to justify it to the Ministry of Science and Technology.  Apparently this ministry is even going so far as to build their own computers using Chinese technology and Linux as the desktop operating system. 
Of course SAP have something like 80% market share in enterprise systems in the country, and there really isn't much of an open source alternative, but it means they have to be working closely with the government to get dispensation for their implementations. 
Chris was keen to point out that, whereas 10 years ago SAP development was limited to their own ABAP and APIs in which you needed significant expertise, with NetWeaver you can use pretty much any scripting language you like.  For example he talked about Lufthansa's website which is written in PHP, but is driven at the back-end by their SAP system.  He also highlighted the source code for ABAP itself has been available since 1992.  SAP have to support 26 different implementations of Linux, and of course they have provided their own Max DB to MySQL so that it is available for public download. 
Developers networking at SAP TechEd '06Elsewhere at the show we saw Duet, their product which brings SAP information and activities directly in to Outlook, or their business browser.  However, I do wonder about the scale of development required.  Sig Rinde and I were shown an interesting demo of Enterprise SOA by Uwe Pyka, Manager Operations EMEA, Enterprise Services Community.  This showed a mySAP system connecting to web services from major banks to pull together a portfolio of financial services product options to be presented to a client.  Obviously the important thing here was the definition of the services from the banks, which could then be easily integrated in to the application.  However, when we asked how much development to pull the demo application together, one of Uwe's colleagues said 3 days.  I can't help feeling that pulling together the half a dozen screens in a product like Thingamy would be somewhere between 30 minutes and a few hours, and that similar development environments I saw at the Office 2.0 Conference would also get that sort of job done in a few hours at worst. 
Eric Wood of SAP LabsI mentioned before that I talked to Eric Wood of SAP Labs.  He is full of good ideas on enterprise widgets, or the fact that "drill down sucks" and everything should be about tags and associations rather than hierarchies - something the Irregulars have been discussing only this week.  He was discussing different widget approaches, liking the Yahoo approach, and commenting that their users and the SAP Developer Network are pushing us in:
"Bringing the consumer experience to the enterprise, and holding us accountable."
This is a good maxim for any enterprise software author, and I hope the more "legacy" elements of the SAP company can respond.
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Shai Agassi presents the new SAP, but the personality is conflicted

Shai Agassi presenting at the EMEA Enterprise Services Partner Summit 2006At the SAP conference last week I sat through Shai Agassi's keynote presentations for both the EMEA Enterprise Services Partner Summit and SAP TechEd '06, as well as an open session with press and bloggers.  He's got an easy, relaxed style and more than one SAPper at this show suggested to me that half the $400m that Henning Kagerman paid for TopTier back in 2001 was to buy his successor.  During the first of those keynotes, Shai got frustrated and dispensed with the corporate slides, to just talk and go "off message" - something which must send the PRs into nervous breakdowns.  It's part of this new SAP that I wrote about, but inevitably leads to the company being somewhat conflicted.  This is reflected in the fact that they don't want to stoop to the level of comment that has come recently from the likes of Larry Ellison, but comments and asides aimed at Oracle were peppered through the presentations.
When Shai was positioning their move in to middleware and creating the NetWeaver platform, he was emphasising the openness of the application, the open API, but joked that they had this great encryption mechanism, because everything was documented in German "which really worked, because we've never had a virus!".   He talked about SDN, which you know I'm impressed with, and that "partnering is in their genome".  He highlighted that 5 years ago they only announced 1 product in the year, whereas this last year they have announced 26.
At both keynotes, he related a conversation with a major customer, who had told him that he didn't want SAP to touch the core of his application, except maybe once every 5 years on a Saturday!  However, the same CIO said that his CEO wanted him to innovate every 3 months, and so this was how Shai explained their upgrade path for mySAP ERP 2005, which won't have any major revamp until 2010, but will have regular Enhancement Packages every few months that you can pick and chose to install.  This appears to be the way they are managing the rapid change required by business, alongside a monolithic application that IT is grappling with managing.
Bloggers and press listening to Shai Agassi at SAP TechEd '06Which brings me to the topic of "choice".  During all of the sessions it was painfully clear to partners and developers alike, that if you want to be doing the "cool" stuff, you have no choice but to upgrade to mySAP ERP 2005.  They have over 10,000 customers on ERP '05, but even more still on R/3.  As a customer, there was a lot of emphasis on your roadmap and action plan to get there from R/3.  As a partner, you were left in no doubt that this is where you should be aiming your marketing and development resources.  As an aside, I was interested by the metrics.  Shai mentioned the 8,500 developers SAP has, and talked about the partners in terms of "where you should be aiming your 20 developers", and that the sweet spot for your partner application, to get the SAP sales guys attention, should be around $250,000 (and remember that's in addition to the SAP software the customer has to buy).  He was suggesting those partners need to build a business plan and set their expectations so that it might take 3 years to be successful.  This was Enterprise oriented with a big capital E!, both for customer and the partner.  I'm not sure how many partners or systems integrators could handle 3 years of investment before they get any payback.  Dennis amplifies this with one of the best Shai quotes, which takes us to the SAP Deathstar Ecosystem
In the TechEd keynote, Shai said that SAP are:
"Not aggregators, we design and build"
"Not like Oracle, we don't tell you what to do"
But how does that stack up with their heavy emphasis on moving you to ERP '05?  In addition, they are definitely conflicted over another topic, which is the database.  One of the ironies of the SAP world is that they are their major competitors number 1 reseller.  They sell significant Oracle database licences, although they can also deliver on DB2, SQL Server, or their own certified flavour of MySQL - MaxDB.  Shai also highlighted the fact that, until recently PeopleSoft had been the number 2 Oracle reseller, with Siebel the number 3
"and look what happened to them".  
Shai Agassi talking to bloggers and the press at SAP TechEd '06I asked Shai directly about this after the open session, and wondered why they didn't level the playing field, so that there sales guys weren't motivated to sell Oracle because of the extra revenue they make.  He told me that they didn't operate like that, and they would continue to offer their customers choice, although it felt like he was saying this through gritted teeth!  Later in the day I asked the same question of Richard Probst, VP Enterprise Services Continuity, and he assured me that the sales guys made no different commission from any of the DB choices.  If I was them, I would be steering the customers to MaxDB, unless there were specific business reasons that made Oracle or DB/2 the best choice. 
The last thing I'd like to highlight, is the emphasis on mySAP ERP 2005, to the exclusion of any other products.  When questions were asked about mySAP All-in-one, we were asked to wait and see.  When a question was asked about Business One, the answer came back that the strategy is unchanged.  I asked Richard that as well.  He said that it was the SAP way - all of the messaging was focussed on ERP '05, but that didn't mean anything sinister for A1 or B1.  I'm afraid that there will be several people at this show who might draw the same wrong conclusion I am drawing, and wonder about the future of both products. 
However, my overall conclusion is that SAP is transforming for the better in to a different organisation, but which is conflicted between the new "cool stuff" that they are doing, and the more rigid legacy of the core of their application.  They have a toe in the Software as a Service waters, but are selling the strengths of their on-premise case and how customers should customize the hell out of the application to get real value.  They wish they could be much more aggressive towards their key competitor Oracle, or the upstart, and say the kind's of things that Larry Ellison and Marc Benioff get away with, but they feel that is not the high ground of the SAP way.  As the pace of change increases, inside and outside SAP, the way Shai steers the ship is going to be very interesting. 
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SAP dismiss AppExchange/Apex as "just a directory of companies"

Zia Yusuf and Peter Graf fielding questions from bloggers and the press at SAP TechEd 06At SAP TechEd, we got the chance to question some of their senior executives over the SAP strategy on Software as a Service or on-demand. Shai Agassi had mentioned the topic in his keynote session as "just another deployment option" which they provide for their customers as well. Later at a press briefing we got the chance to ask Peter Graf, the Executive Vice President of Global Solutions Marketing, and Zia Yusuf, the Excecutive Vice President of Platform Ecosystem Development,more on the topic.