SAP plans to roll out SRM solution

SAP AG said Monday it plans to enter the SRM (supplier relationship management) market in a move that could jeopardize its relationship with key partner Commerce One Inc.

SAP's planned launch of an SRM product could make SAP a direct competitor of partner Commerce One, which last week announced a strategic sourcing product, which is often a core SRM technology.

As a result, SAP will end joint sales of the pair's procurement product, according to source familiar with the company's plans.

"Commerce One is an independent company," said the SAP spokesman, who declined to be named. "They definitely will continue to be a strong partner in the integration technology space. We will definitely continue to work with them for joint development on future products."

The spokesman declined to comment on the future of joint development and marketing of Enterprise Buyer, the procurement product, or MarketSet, the joint marketplace solution.

SAP plans to continue to jointly develop and market the pair's MarktSet, the source said, but the company will not continue to jointly market Enterprise Buyer.

"Commerce One says they're going to continue to do joint selling [of Enterprise Buyer], but SAP is saying they're not," said the source, who asked not to be named. "SAP wants to continue to grow their footprint and maintain control over it."

The move to end joint sales and support of Enterprise Buyer could prove difficult for Commerce One, which receives 50 percent of its revenue from joint sales with SAP, the source said. The majority of the revenue generated from the partnership comes from Enterprise Buyer sales, according to the source.

Commerce One officials could not be reached for comment by press time.

The loss of SAP as a key revenue sharing partner could come at a crucial time for Commerce One, which posted a US$2 billion net loss for the quarter ending June 30 and a $119 million net loss for the quarter ending in October. In June, SAP pledged $225 million in new investment capital to up its stake in Commerce One to 20 percent.

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