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6/9/2009
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SAP Unveils SaaS Strategy

SAP's new head of on-demand software applications for large companies provides the first details of SAP's strategy for delivering subscription-based apps to Business Suite customers.

Three of the four products in the first wave of on-demand apps are already on the market: SAP CRM, e-sourcing, and carbon emissions management. However, SAP CRM currently isn't multitenant -- SAP plans to upgrade those customers to a multitenant architecture, but customers won't notice any changes, Wookey said.

The carbon emissions offering, already multitenant, comes from the Clear Standards acquisition, and the multitenant e-sourcing service comes from Frictionless.

The last offering in this first wave, for expense management, is due out later this year. There also will be mobile versions of on-demand applications, based on technology SAP is getting from its SkyData acquisition.

Multitenancy -- in which groups of customers share the same instance of a software application, even though their data is kept separate -- helps software companies keep costs down for the hardware, software, and energy they use to host customers' applications. In turn, that allows them to offer competitive subscription prices. Wookey describes Frictionless' technology, which will be the foundation of SAP's on-demand platform, as "Java-based with a true multitenant architecture."

After joining SAP, Wookey said he spent a few months understanding what SAP had done to date with on-demand services. In January, he brought his proposal for an on-demand strategy to SAP's executive board. That was followed by a business case, an execution plan, and the creation of a team to execute that plan.

Wookey's management team includes Mark Ellis, former VP of development at Frictionless who heads up on-demand platform development at SAP; Frictionless' Wayne Haubner, an expert in SaaS system usage and monitoring, to head managed services; and Shailesh Rao, formerly of Salesforce and Siebel, to head up on-demand solution management.

Wookey's team also includes Peter Lim, who was co-founder and CTO at SkyData and former VP of engineering at Siebel, and Kevin Nix, co-founder and CEO of SkyData and formerly VP of CRM at Siebel. Wookey said he has a dedicated development team for on-demand apps, but said it was against SAP policy to disclose how many people are on that team.

SAP has not publicly announced the SkyData acquisition. In a statement provided to InformationWeek on Tuesday, SAP said "SkyData's application will provide mobile and third-party integration capabilities for SAP's large enterprise on-demand services, and we will provide more detail about our plans for the SkyData application in the near future. The purchase closed on May 25."

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