US firm outsources SAP operations

Manufacturing firm Tyco has outsourced its mission critical applications in the US in a landmark application hosting arrangement.

Tyco's US office has hired an application service provider (ASP), HostLogic, to host and manage its SAP applications for externally for $US500 per seat per month and is believed to apply to several thousand US company seats.

However, a spokesperson from Tyco's Australian headquarters said the Australian and New Zealand offices did not use SAP applications.

"With a company this big, I think a little diversity can be expected," the spokesperson said.

The spokesperson also declined to comment on imminent ASP-related moves for the company's Australian offices.

While many specifics of the US deal - including its scope and overall dollar value - have not yet been disclosed, Howard Rubin, a research fellow for Meta Group, said it was unique for a company the size of Tyco to outsource mission-critical applications. He said most businesses moving to ASPs fell into the small to medium enterprise (SME) group, whereas Tyco held offices in more than 80 countries.

"I haven't seen anything this size... It may be an absolute landmark for a pure (ASP)," he said.

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