Sapphire: SAP admits problems with hosted business suite development

Executives of German business software maker SAP remain committed to a first-quarter 2008 launch of the company's hosted midmarket application despite acknowledging problems with product development.

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Executives of German business software maker SAP remain committed to a first-quarter 2008 launch of the company's hosted midmarket application despite acknowledging problems with product development.

Henning Kagermann, CEO of SAP, referred to development issues with the new software, code-named A1S, as "normal".

"As long as the product is not volume-ready, we'll have problems every day," Kagermann said on 14 May at the launch of the software giant’s European user conference.

Kaggerman was answering rumours that SAP may have to push back the launch of A1S as a result of unforeseen challenges in developing - and supporting - the new on-demand offering.

A1S will target midmarket customers who seek an inexpensive, easy-to-deploy, low-risk suite of business applications including ERP (enterprise resource planning), CRM (customer relationship management) and SCM (supply chain management).

The hosted application, to be available as a monthly subscription, will give smaller, cost-sensitive companies the flexibility to set up and test the software on their own before deciding to make a purchase, using a "try, run and adapt" model.

A1S is a "very important event" for SAP, said board member and president of global field operations Leó Apotheker. "It's not just a new project," he said, but "a whole new business model."

A number of select customers have already tested the product and more will join the testing over the months ahead, according to Apotheker.

The company is still "testing, refining and adjusting" on the product development side and "doing all the things we need to do on the business model side" to have the product ready for a commercial launch in the first quarter of next year, he said.

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