SAP: People don't buy a system, they buy into an ecosystem

Summary:I'm heading back from SAP's analyst summit in Las Vegas. Several Enterprise Irregulars have weighed in (Jeff Nolan, Dennis Howlett, Jason Wood)on revelations, mostly reaffirmations of previous statements about the company's roadmap and aspirations, from the event.

I'm heading back from SAP's analyst summit in Las Vegas. Several Enterprise Irregulars have weighed in (Jeff Nolan, Dennis Howlett, Jason Wood)on revelations, mostly reaffirmations of previous statements about the company's roadmap and aspirations, from the event. What's clear is that by the end of 2007 SAP expects to have reached a tipping point, in its favor, for its services-enabled ERP platform and ecosystem. A year from now the company expects to have enough mySAP ERP 2005 customers, Web services and xApps to attract enough developers to being rolling its snowball downhill, gaining some momentum in the mid-market and leaving Oracle and Microsoft trailing further behind in the large enterprise.

Peter Graf, executive vice president for marketing solutions captured the essence of SAP's strategy in this statement: "People don't buy a system, they buy into an ecosystem. We can make it very worthwhile to stay in our network. If you go outside there is a cost--it's called integration." 

The SAP marketing machine will try to drum the mySAP ecosystem message into customers' heads, as Marc Benioff does for salesforce.com's platform or Microsoft for the Windows platform or Oracle for the all Oracle platform. And, all of them are promising to make take out the unrelenting integration and deployment costs, especially if customers move to more 'pure' enterprise SOA platforms. I don't believe that SAP or its competitors think that they can be expose thousands of standards-based Web services and create a walled garden, but they do think that they can create competitive advantage with their platforms and ecosystems. Jason Wood put it succinctly:

It's very much about Barbarians at the Gate.
 
The assailants (emerging vendors leveraged directly to open standards, web services, etc...) are counting on Jeff's assertion [referencing Jeff Nolan's post]; that try as they might, all those 1000s of Web services SAP and Oracle are creating will be too accessible for SAP and Oracle to control the ecosystem entirely.
 
Meanwhile the big boys are betting on just the opposite tact. They're using Web services, SOA, etc...as a marketing tool to fuel the next wave of upgrades and add-on purchases, but are trying desperately to insulate their ecosystems in other ways.
 
For my money, we couldn't be entering a more interesting time to be a part of the enterprise software/services ecosystem.

 

Topics: SAP

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