SAP discloses price, delivery plans for A1S hosted apps

Kagermann says company's hosted ERP software suite targets midsize companies

SAP AG today christened its suite of hosted ERP software for midsize companies SAP Business ByDesign during an event in New York.

SAP officials have said that the company will invest $400 million to $550 million by the end of 2008 to support the introduction of the service, including a consumer marketing campaign on the Web to alter the perception of SAP as a provider of software for big businesses.

During a demonstration of the product at today's event, SAP CEO Henning Kagermann said the unveiling of the service, code-named A1S, was "the most important announcement I have made in my career."

He said the service would first be offered in the U.S. and Germany, and then in England, France and China.

Business ByDesign is priced from $149 per user per month for a minimum of 25 users, including services and support, SAP said. Customers also pay $54 per month for each group of five "efficiency users," or casual users who access the software only to fill out expense reports and purchase confirmations, for example.

Kagermann said the SAP Business ByDesign service will offer access to manufacturing, purchasing, accounting, sales and marketing, and human resources applications. The service is aimed specifically at businesses with between 100 and 500 employees, he added.

Kagermann said the company already lists 20 pilot customers of the service in Germany and the U.S., including a small aircraft manufacturer, a manufacturer of air fresheners, a technology consulting company and a company that offers packaging and distribution services to pharmaceutical companies.

SAP didn't specify when the service will be available to all potential customers, though analysts expect it to be widely available in most countries by the end of 2008.

The company said the service is targeted at organizations that have avoided ERP investments because of the software's price and complexity. Analysts said the challenge will be to offer a product that's easy for companies to configure but that meets the needs of their individual businesses.

Copyright © 2007 IDG Communications, Inc.

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