Can you explain how NetWeaver gets delivered to customers? There are three ways. First off, SAP is creating all...
its applications going forward using the NetWeaver platform. It's part of our R/3 Enterprise application. It's part of our mySAP application suite. It's part of the xApp solutions. If you are a customer who runs R/3 Enterprise 4.0, and you would like to have the capabilities as part of the solution, you would bring in the new solution, and upgrade, and NetWeaver would be part of that solution. So that's one way. So I buy SAP's CRM product, then I don't have to pay for NetWeaver? No. As long as you are using it only to use CRM capabilities, then it's part of the solution. When you go beyond that, when you integrate non-SAP products or you are doing development, that would require a license. How does SAP's xApp technology figure into this new platform? It's absolutely core. It makes the whole vision of deploying what we call our Enterprise Service Architecture across the board much more credible. The idea of the ESAP is that you can extend existing functionality without touching underlying functionality, without touching existing stuff.
Cross-applications, or xApps, are unique in the way that they run across functional silos. But you can use the same technology, apply it to one functional silo, and extend the capabilities of that silo. And that's what we're doing. Was it tough to get IBM and Microsoft on board?
No. How did it happen?
We told them, "Customers have .NET, and they have Java, and they want to make sense out of it. Customers want something that can leverage their system." And if a couple of companies can find out what the hell Web services means for all of us, then SAP is probably one of them. With this announcement, SAP has deepened its technology stack. Doesn't that put you in a position where you are competing with the companies (IBM and Microsoft) that you are also embracing?
At Microsoft and IBM, they know that the majority of the SAP customers will go with models No. 1 and No. 2, as we talked about. We are bringing the infrastructure to the customers. If you need to have an application platform, then WebSphere and Microsoft are just as good. What we are really suggesting is that if you wanted to create cross-applications, then we have the only platform to do cross-applications today. What are the two other ways?
The second way is when SAP delivers NetWeaver to you in order to solve specific integration problems. Now you can do that without upgrading for existing systems.
That's a big promise. That's what makes it very attractive. For example, you can use your existing R/3 system, and we can give you mySAP Enterprise portal, so that you can use NetWeaver technology. Now, we pre-configure that portal with business content so that it's very easy for you to go live.
As you heard today from LSI, it took them two-and-a-half days to implement NetWeaver, which, honestly is a ridiculous amount of time. That's nothing. They leveraged the fact that we delivered pre-configured content. What's one way SAP CRM changed as result of this technology?
One way is that we have implemented a whole new user interface for CRM by using a pattern-based design. The pattern-based design not only helps SAP to significantly reduce the time we need to develop a solution (especially the time we need to develop a user interface) but it also significantly eases implementation. If you want to change a pattern, then you change it once, and the change will be applied across all the applications that use that pattern. For the users, it means that you only learn five or six patterns across your application and it makes it much easier to use functionalities that you haven't seen before. And the third?
The third version is that you acquire SAP NetWeaver as your strategic integration platform . That means you want to go into significant development. You want to create new integration scenarios. In this way, you can license NetWeaver as a whole.
The most important thing, and I can't stress this enough, is that even when SAP Netweaver is shipped as part of SAP, it is open to all types of solutions. And I can't stress that enough. It took us a lot of work and a lot of hard lessons learned in the last couple of years. We've come to the point today where we can proudly claim we are truly open. People seem to be wary of TCO promises, though. How specifically does NetWeaver save money?
Two-and-half days to get your portal up and running! Compare that with a half-year project and five people.
Then there is Texas Instruments. They implemented NetWeaver, and within one month were going live. In the first week, they have trouble with the network. They are losing one of the network connectors. The system halts. The Exchange Infrastructure stops working. They had to do 2,300 orders through the SAP Exchange Infrastructure, but right around 1,000, they lost the fire connector. The whole thing stops. They stand there, scratch their heads, and it takes about 10 minutes for the fire connector to kind of reinitialize itself. So the thing comes up again--and it starts processing, and they all go into shock. They're like "'Oh my God. Now we are doing double counting because it's going to start from scratch."
But it doesn't do that.
The fact that it just started at the last order in the last business process, not creating any redundancy across the infrastructure, that's what I call TCO. What is the strongest selling point for customers considering NetWeaver as their strategic integration platform?
It's the platform that gives you the lowest TCO. Because it's the platform created by people who have been doing business processes all their life.