Bangalore: The world’s biggest business software maker, SAP AG is testing its on-demand software product targeted at small and medium businesses with 100 customers, including several firms in India.
The product called ‘business by demand’ is already behind schedule, and the firm is yet to decide on business model that will be profitable by offering it on rent.
“We need a price which is competitive in the market,” said Jim Hagemann Snabe, board member of SAP, in an interview.
He, however, did not disclose at what price or when the product would be offered in the market.
Volumes game: Jim Hagemann Snabe, member of the executive board, SAP, did not disclose pricing or launch details. Hemant Mishra / Mint
In 2007, SAP announced that the software as a service product would be available to customers the next year. Traditionally, SAP, which competes with Oracle Corp, sells software licences for large companies to run their businesses, and provides support.
But in the current economic situation, large customers are either delaying or cancelling large software usage plans, forcing firms such as SAP to look at small and medium businesses in a market fragmented because of local players.
“That is why we are eager to get the total cost of ownership equation perfect before we go with volumes,” said Snabe. “Once we are out there, it is hard to correct after that”.