SAP has managed to score some impressive alliances this week that significantly strengthen the companys position as an enterprise applications provider.
The announcement that SAP AG and Microsoft Corp. will simplify the interoperability between their respective NetWeaver and .Net Web services development platforms will make it easier for SAP customers to deploy enterprise applications in the Windows environment.
To achieve this, SAP will issue a NetWeaver upgrade in 2005 that will enable SAP applications to integrate with Microsofts Biztalk Servers. SAP also will provide sample code allowing developers to integrate SAP applications with Microsoft Office and with applications built with Visual Studio 2005.
For its part, Microsoft has agreed provide in 2005 the repository managers that will link SAP NetWeaver Knowledge Management to Windows SharePoint Services and Microsoft Exchange Server.
SAP also will provide a portal development kit to allow .NET developers to create custom applications that can work with the SAP portal platform.
SAP also has agreed to support Microsoft Visual Studio .NET so that developers can work within the Visual Studio Integrated Development Environment to build Windows front ends to SAP applications. Version 2.0 of SAPs .Net Connector, due for release in August, will include improved Visual Basic Language support.
Its not as though SAP has had any trouble migrating into organizations where Windows prevails. More than 40,000 SAP installations already run on Windows, and two-thirds of new SAP deployments are based on the Microsoft platform.
But greater integration between NetWeaver and .NET should streamline the development process. This should prove to be a particular benefit to organizations that are running mySAP Business Suite on Windows.
But it will be of the greatest benefit to Microsoft independent software vendors, who will find it easier to build applications that work with SAP applications.
Development and technology alliances such as these are never done for altruistic reasons. This partnership brings competitive risks along with benefits for both companies.
For SAP, the risk is that the closer integration will enable Windows ISVs to chip away at application functionality that might otherwise have been provided by SAP applications.
Weighing the Risks
The risk for Microsoft is that if SAP gains ground in Microsofts core enterprise market, it might encourage the migration to SAP applications on other platforms, such as Linux. There is also a slight risk that SAP could erode Microsofts dominance on enterprise desktops.
The fact that SAPs NetWeaver is fully compliant with the Java 2 Enterprise Edition (J2EE) standards may confer some small advantage among customers where this is an important factor.
But the benefits for customers as well as for the competing companies outweigh the risks. The risks of standing aloof from each other are greater. You cant have any influence on a market or on a widely used application platform if you try to ignore it.
This is a theme that has been constantly repeated throughout the history of the computer industry. Competitors have to be prepared to play on the same field or find they are eventually shut out of the game. SAP and Microsoft wield so much market power that they simply cannot ignore each other.
SAP also disclosed that it is working with major hardware companies to help implement “adaptive computing” capabilities in the NetWeaver platform.
Adaptive computing is a process that is supposed to allow enterprises to rapidly change their systems and business processes to adapt to changing business conditions.
For IT managers, adaptive computing is a way to develop and deploy applications so they can be processed at any time, on any server that can do the job the fastest at the lowest cost.
SAP is building shared services and service virtualization features into NetWeaver that can rapidly assign the processing of specific business applications to the underlying hardware that is most efficient. The company is scheduled to release the adaptive-computing features for NetWeaver in June 2004.
SAP said it is working with Dell Inc., Fujitsu Ltd., Hewlett-Packard Co., IBM, Intel Corp., Network Appliance Inc., Sun Microsystems Inc. and T-Systems Inc. to implement adaptive-computing services across their hardware product lines.
It remains to be seen whether adaptive computing can deliver the promised computing-efficiency improvements and cuts in total cost of ownership that SAP and its partners have promised. Its still another question whether such efficiency improvements will actually be detectable on the bottom line of IT expenditures.
But again, customers will reap benefits, even if adaptive computing delivers even a small fraction of the promised efficiency improvements. If it is demonstrably successful, SAP will gain significant market advantages for being among the first enterprise software companies to prove that it actually works.
eWEEK.com Enterprise Applications Center Editor John Pallatto is a veteran journalist in the field of enterprise software and Internet technology.