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SAP Taps Yahoo! to Help With Enterprise Portal

SAP AG has tapped Yahoo! Inc. to help the European software giant establish a new Palo Alto, Calif.-based subsidiary, SAP Portals, in an attempt to broaden its distribution of enterprise resource planning software throughout workplace desktops.

Under the agreement, the companies will work together to develop a joint enterprise portal and market it directly to their customers and through their separate sales channels. SAP Portal will market a basic edition and professional edition with pricing dependent on the number of seats licensed by the enterprise. The joint enterprise portal offering will be available in the second quarter of 2001.

The partnership speaks volumes about Yahoo!'s abilities to control the user's desktop. Yahoo! entered the corporate portal business only nine months ago -- much later than SAP, which first unveiled its mySAP.com portal at the 1999 SAPphire conference and has been developing it ever since.

"The portal allows the transparent access to the business scenarios going across various systems," SAP CEO Hasso Plattner said at a press conference. "We try to ship as much software as possible but the goal of 99 percent penetration is not realistic."

Indeed, the reward is significant. According to Goldman Sachs, B2B software solutions is a $10 billion market that is expected to grow to $56 billion. As such, SAP stressed that its portal would no longer only carry SAP solutions but also that of Oracle, Siebel Systems and other competitors. But clearly the key to delivering software to the end-user is first winning over the desktop throughout the workplace.

To its credit, Yahoo! has been very sucessful in leveraging its portal business into the enterprise signing on several large-scale customers over the last nine months. And much of that success is attributed to extending its strategy of providing "choice made easy" first to the consumer and then throughout the workplace, Tim Koogle, chairman and chief executive of Yahoo! Inc., explained at the press conference.

"Working in tandem with SAP, we see a tremendous opportunity to extend our platform through delivering the joint enterprise portal solution through our combined channels," Koogle said in a statement.

SAP Portals will initially employ 700 people in the development and marketing and kicks off with more than 1,000 customers. The portal business will concentrate on mySAP.com's e-business platform along with customer relationship management (CRM) and supply chain management (SCM) solutions as well SAPMarkets, Inc., a wholly owned marketplace solutions subsidiary created with the help of integration partner, Commerce One.

The SAP Portals subsidiary combines the assets of three units of the SAP group: TopTier Software -- an acquisition that SAP announced last week -- the current SAP AG general business unit dedicated to the mySAP Workplace enterprise portal and mySAP Business Intelligence solutions; and eSAP GmbH, an SAP professional services subsidiary focusing on enterprise portal and e-business projects.

"With the portal offering we bring to the table together, we want to reach 100 million enterprise users," Plattner said.

SAP Portals will be headed by Shai Agassi, currently CEO and president of TopTier.