Who says enterprise software is boring? It certainly isn't for SAP customers. SAP gave us plenty to talk about...
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this year. Here, we rank the top eight SAP news stories of 2008.
8. SAP: We can't develop everything ourselves
SAP continued to move away from a solely internal product development model and pushed co-innovation, in which it partners with other vendors and even customers on new products. The theme headlined TechEd, SAP's annual conference for SAP managers, developers and administrators. SAP also announced its first major projects with vendors like Cisco and VMware, and started a website called EcoHub, where customers can review partner products.
7. As competition for the midmarket heats up, another gadfly emerges
Last year, it was Microsoft Dynamics that made all the noise as SAP strove for dominance in the midmarket.
This year, the noise came from a slightly smaller vendor called NetSuite. The SaaS-provider-that-could grabbed headlines with its pointed attacks on SAP as it sought to capitalize on the delayed release of SAP's Business ByDesign. In the summer, NetSuite released manufacturing software and announced it was taking on SAP's core market. When discontent over SAP's support fee increase took hold, NetSuite launched an offer targeting SAP customers on older releases, offering to cut their bills in half if they switched to NetSuite's SaaS ERP.
6. SAP skills shortage emerges
In the spring, SAP admitted it may have a problem on its hands: too few people with the skills to implement and run its systems. The SAP skills shortage started driving up pay for consultants and made it tougher to find people to work on projects. Some analysts even said that the shortage was becoming a big part of purchasing decisions and could drive buyers to Oracle and Microsoft.
ASUG launched a consultant directory , where companies could rate consultants, to help alleviate the shortage. And SAP focused on building a University Alliance program in which it partners with local colleges to turn out more SAP freshers.
5. Business Objects acquisition starts to take shape
The Business Objects and SAP merger moved fast. SAP closed the deal in January and released its first new product a month later. SAP's business intelligence product roadmap started to become clearer in March when the company announced that it would phase out some products by 2016.
The company continued to be SAP's star throughout the year. SAP continued to enhance it with new features, including a tool that leverages data in Microsoft Excel and Crystal Reports for SAP Business One users. ASUG started a user group devoted to Business Objects customers.
Plans for the two product lines still aren't entirely clear. But SAP Business Objects will become one product line by 2016, according to CEO John Schwarz, and more plans will be revealed in the coming year.
4. Recession costs SAP potential customers, new deals
After a stellar second quarter, SAP succumbed to the growing global financial crisis. Small and midsized customers couldn't get the financing they needed to go through with planned deals, and SAP's earnings sank. The vendor announced that it would cut spending but wouldn't cut budgets for product development.
3. SAP delays Business ByDesign but debuts new on-demand effort
Just seven months after it announced the debut of its SaaS ERP for the midmarket, SAP decided it wasn't really ready. In April, it announced that it was scaling back the rollout of Business ByDesign.
Early adopters continued to say they were happy with their choice. Later, analysts said that the vendor was struggling to figure out how to scale the product . Then the recession hit, and while co-CEO Leo Apotheker said Business ByDesign is "probably the coolest application we have ever written," he also said it wouldn't be wise to release it in this economy.
In the fall, SAP hired Oracle's former head of applications development, John Wookey, to head up development of on-demand applications for large companies. The vendor has been quiet on the details, save for Apotheker saying that you can't run everything in SAP in the cloud.
2. SAP vs. Oracle: The drama continues
SAP's hiring of Wookey to head up on-demand for large companies was the tip of the iceberg when it came to the ongoing saga for dominance between the two vendors this year.
Last year, Oracle sued SAP for alleged impropriety over its third-party support subsidiary, TomorrowNow. And this summer, a little more than a year after that lawsuit was filed, SAP closed TomorrowNow.
Many analysts thought the decision would bring an end to the costly lawsuit between the two software giants. Well, it didn't.
A week later, Oracle filed an amended complaint, stating in explicit detail its case that TomorrowNow stole its underlying applications, and alleged that SAP executives knew about it. Oracle then alleged that SAP wanted to expand the illegal TomorrowNow operation to Hyperion and Retek products, which Oracle owns.
But in the fall, a federal judge ordered Oracle and SAP to come up with a settlement figure by February.
1. SAP increases maintenance and support fees with Enterprise Support
In the summer, SAP announced it was eliminating its tiered maintenance and support offerings and moving all customers to Enterprise Support in January 2009. The new support structure increases customers' maintenance and support costs from 17% of net licensing fees to 22% over the next four years.
SAP's customers didn't take kindly to the price increase, and heads of user groups formed a special task force to lobby SAP on the issue. Analysts urged customers to push for more value from the new offering.
SAP stood firm on its new offering but said it would support ERP 6.0 through 2017 and work with user groups to develop KPIs for Enterprise Support adoption -- though it was cryptic on what those would be.
Then, a few weeks ago, there was more news from the homeland. German and Austrian customers were granted another year of support under the terms of their current contracts. SAP said it was because of a legal loophole in those countries, but analysts agreed it had as much to do with patching up bad feelings over the changes. Whether more SAP users can win concessions on Enterprise Support remains to be seen.
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