RealTime IT News

SAP Strengthens Silicon Valley Presence

PALO ALTO, Calif. -- SAP brought out its top brass to show off the big iron inside its new Co-Innovation Lab here today. Executives from a number of tech companies, including HP , Intel , Cisco  and NetApp joined SAP CEO Henning Kagerman and other top execs at the unveiling of the lab which includes computer products and systems donated by the above-mentioned companies.

Kagerman said the Silicon Valley lab was a natural offshoot of a similar facility it has at SAP headquarters in Walldorf, Germany. "It's very important that customers see this," said Kagerman. "When we did this in Walldorf, having partner [companies] side by side, helps a lot."

The idea is to go beyond vanilla configurations and canned demos to show SAP products working in a heterogeneous environment with real world data. "We've got enough storage here to run a Fortune 500 company," Richard Probst, vice president of market development engineering at SAP , told internetnews.com. The shiny new data center includes HP Storageworks products, HP blade servers and other hardware from Cisco and NetApps, with more on the way.

"I think what customers really want to see is real life….We all know in IT the devil is in the details," said Kagerman. "The final proof is when people can touch it. Talk is cheap, at the end of the day it's about hard work."

SAP execs said so-called virtual meetings and other marketing tools can be useful, but they stressed the importance of in-person customer engagements. "In the world of technology we can't forget human beings," said Zia Yusuf, SAP's executive vice president, global ecosystem and partner group. Noting the new labs gleaming appearance, Yusuf said the intent is not to make it a slick showcase.

"I hope it doesn't look as nice in the future," he said to laughs from the audience. "It's meant to be a working lab with space for customers, ISVs  and our tech partners to interact."

The lab will be a key point of customer contact in the U.S. for SAP, which already employs over 1,600 people at the Palo Alto facility it's operated for more than ten years.

Sponsors of the lab will participate in joint projects with ISVs, systems integrators and other technology vendors. There are also plans to have them collaborate with SAP to develop "solution blueprints" designed to help customers create data center environments optimized to support enterprise SOA . Callidus Software, Novell, Questra and Wonderware are among the first ISVs signing on to initiate projects.

Responding to Oracle; future products

SAP execs touched on a few other issues during the event. Regarding Oracle's copyright infringement lawsuit, SAP deputy CEO Leo Apotheker reiterated the company's earlier statement that it intends to "respond vigorously to the claims" made by its archrival Oracle.

"We have a long standing tradition of respecting intellectual property among our 40,000 customers," said Apotheker, "it's a pretty clear thing." SAP has said it will file a former response to the charges by the July 2 deadline set by the courts.

Kagerman also expounded on SAP's strategy in software-as-a-service (SaaS) in upcoming products such as A1S due out early next year. Designed for mid-market companies, A1S (which is a codename) is an on-demand suite of business applications such as ERP , CRM   and SCM (supply chain management).

Much like the model made popular by Salesforce.com , the idea is to offer hosted applications available on a monthly subscription basis that is more attractive to smaller, cost-sensitive companies.

But Kagerman was quick to try and distance SAP from Salesforce, which is considered a pure-play SaaS provider.

"I don't believe software as a service is the ultimate answer," he said. "The answer is choice; you need a hybrid model for the client to decide which pieces to run as a service and which not to ….You can't compare Salesforce to A1S. Salesforce is CRM. A1S is an entire business suite for the mid market."

But like Salesforce's apps, Kagerman noted the on demand model offers lower cost of ownership and the opportunity to win new customers.

"We want to prove you can run your entire business in an on-demand mode, which we feel no one has done yet," said Kagerman. He added that SAP's target of lower end, mid-market businesses is a big opportunity. "It's a $15 billion market that is untapped by SAP, and fits nicely by what we want to prove."