We know what this means to SAP in the Clouds, but what happens to the users on the ground?

SAP Takes It All to the Cloud

By QUENTIN HARDY

SAPVishal Sikka, of SAP’s executive board, was among those overseeing the rollout of a cloud-based product providing companies with fast computing and data retrieval.

SAP, the German software giant, is making one of the largest pushes into cloud computing yet seen from a large incumbent company. It may even be destroying its own business, in order to build for a new one.

SAP is famous for developing enterprise resource planning, or ERP, software. ERP is used to control complex manufacturing, run corporate functions like financials, or manage a company’s systems of supply. A few years ago SAP introduced HANA, a product that combines fast computing and data retrieval to better analyze how well a company is working. The product has been a big hit, and SAP has been proclaiming it the company’s future.

On Tuesday SAP said it would offer HANA as a cloud-based product, providing companies with access for the cost of a license. Prices were not disclosed. SAP has established a network of seven data centers around the globe to support the endeavor, a company official said, and will begin by deploying 30,000 computers for the network.

“We will do cloud-based ERP on a massive scale,” said Vishal Sikka, a member of SAP’s executive board and one of the people who oversaw the project. Of SAP’s regular product, he said, “At some point in the future, complex implementations should go away. All of our products are moving to HANA.”

SAP, along with companies that have agreed to test the product, already has 750 terabytes of data in the system, enough data to fill 750 million good-sized books. The company expects to have twice that amount in the system by the end of the year.

That probably is not all that much data, compared with the amount SAP touches the old-fashioned way, with conventional computer servers inside companies, but it is a decent start. As SAP builds the trust of big customers with its cloud, Mr. Sikka said, SAP will become a giant.

“We have single customers running projects that are bigger than the entire Salesforce.com cloud,” he said.

SAP has already been running both cloud and software as a service, or SAAS, projects, thanks to its acquisition of two companies, Ariba andSuccessFactors. With HANA in the cloud, however, SAP is moving much more into offering insight online, either directly to its customers, or as a service to end-users.

Mr. Sikka said SAP served some 220 utilities globally, who reach about 2.5 billion customers. The utilities could let the customers use HANA to model how much they were spending, and finding ways to cut their bills. “We realized we could do that for them with 2,000 servers,” he said.

Other uses of the data analysis tool might include real-time understanding of online customers, financial risk analysis or rapid insight into geologic information for energy companies, he said.

If SAP follows through on a fast build out to cloud computing, it could create some tension with Amazon Web Services, currently an SAP partner. AWS has recently made it clear that it wants to host a lot more corporate computing in its giant cloud.

And, as usual over the last couple of decades, the move will be viewed in terms of competition with Oracle, which is operating its own cloud services, but also offers a lot of servers and software for customers to buy and use inside their companies.

“Oracle – what can I say?” Mr. Sikka said. “The future is in open clouds, not proprietary hardware.”

11 Comments

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  • UnBelievable
  • Houston, TX

    And the clouds run on what? Vapor. I respect SAP and how they compete against Oracle but statements like that temper my enthusiasm for the company.

  • Priscilla Berry
  • Milwaukee, WI

    SAP does not specify just how they are going to provide Hana as a ” cloud-based product.” Are they going to rewrite Hana as a multi-tenant Native Cloud tool? Or are they just going to host it in the cloud as a Legacy Cloud tool?

  • maxvox
  • Rochester, NY

    That doesn’t excuse illiteracy. I’m a technical narrator and have corrected the usage many times. I’ve never been overridden by a client.

  • on-line reader
  • Canada

    When you cut through the marketing hype, it sounds like a return to the olden days of “Time Sharing Bureaus”. What the article doesn’t make clear is whether Company “A” will have any sort of access to the data from all the other companies it is sharing the Cloud with. 

    If Company “A” only can access its own data, you have to wonder if Company “A” would be better off hosting its own servers, or going with a generic provider. 

    And, of course, there are other issues such as privacy. A lot of Canadian companies/organizations, for instance, do not want their data hosted on a server in the U.S. because the privacy laws in the U.S. are a lot weaker than those in Canada.

  • Samir
  • Singapore

    Is it best for SAP to “buy” than “build”. “Big brotherly” statments on SFDC are good; It may not sell anymore as SFDC consumers simply love it; Its best to look out and see what’s working out there?? Anything build internally (minus ERP) had not seen any real value, mate.
    I see signals of a confused strategy….and usual “late” catch up over Oracle.
    Welcome “Big brother”. Start buying working innovations out there…..
    You have a lot of free cash. buy revenue every quarter…..

  • Jonathan
  • NYC
  • Verified

    Yes, and when hackers break in and see the undisclosed real-time financials of publicly-traded companies, what happens then?

    • Lois Ginter
    • Madison, WI

      Not to mention employees’ SocialSecurity numbers, home addresses, and bank account numbers.

    • DipB
    • San Francisco

      So hackers cannot break into financial institutions, firewalled computer networks, government databases ? You guys must be living under a rock. There have been many high profiled hacking of heavily firewalled computer networks including defense departments, banks, sony playstation servers. Cloud computing actually provides higher level of security by pool security resources and providing the highest level of encryption at the data center level.

  • maxvox
  • Rochester, NY

    The caption under the photo on the business page should read “on premises”, not “on premise” software. Resident software is on the business’s premises, or property.

    • maxvox
    • Rochester, NY

      Update: Kudos to The Times for eliminating the erroneous content.

    • ochowie
    • Ohio

      Unfortunately, on premise the industry term.

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