ERP Heavyweights Intensify ASP Competition

SAN MATEO (03/03/2000) - AS USERS RUSH to the digital marketplace, they are looking to the major ERP (enterprise resource planning) players to provide direct application hosting services, which is adding new fuel to the highly competitive realm of ERP.

In anticipation of the move to trading exchanges, digital storefronts, and automated supply chain backbones, PeopleSoft Inc., SAP America, and J.D.

Edwards are fine-tuning their architectures and signing up partners. Lawson Software last month showcased how it is reaching upstream with new ASP (application service provider) capabilities. Oracle announced last year that it will begin hosting its applications.

When looking toward ASP hosting for ERP applications, end-users should keep an eye on how their ERP vendors will handle the data center hosting as well as Internet and network security and management, according to Lance Travis, an analyst at Boston-based AMR Research. Users should also be aware that these ERP players will most likely need to outsource parts of the ASP hosting process such as the data center support, he said.

In sum, users will be embracing "pockets of specialization," and the ERP hosts "should be positioned to support this," Travis said.

This week in the course of announcing a set of ERP modules for systems integrators, PeopleSoft officials, led by president and CEO Craig Conway, pointed to announcements coming next week about hosting its applications.

PeopleSoft is following closely SAP's similar announcements at the CeBit show in Hannover, Germany.

Since January, J.D. Edwards has made it plain that it is moving to the ASP model, complementing that effort with business partnerships.

Officials at J.D. Edwards said the main advantages are its ability to host the J.D. Edwards end-to-end suite of supply chain and ERP applications as well as to accommodate users either through third parties or interoperable components.

"We're finding customers are racing to get to the digital marketplace," said Gayle Sheppard, vice president of JDe.sourcing for J.D. Edwards. While the conventional wisdom is that the ASP model will bring ERP to the middle-tier masses, PeopleSoft has seen heavy demand for ASP-based services in the high-end, company officials said.

J.D. Edwards has put itself slightly ahead of the competition, in part by designing an architecture well-adjusted for the Web, and has lined up key partners such as Ariba, Travis said. J.D. Edwards also has lined up business and technology partnerships.

"Architecturally, I'd probably say they are [ahead of the others]," Travis said. "But users are not going to [buy from] a vendor based on an architecture."

The others either have a similar infrastructure in place or aren't far behind, Travis added. Although SAP is still making the transition from client/server to multitier Web computing, PeopleSoft has its architecture ready as it predicted it would last September, Travis said.

PeopleSoft Inc., in Pleasanton, Calif., is at www.peoplesoft.com. SAP America, in Philadelphia, is at www.sap.com. J.D. Edwards, in Denver, is at www.jdedwards.com. Lawson Software, in St. Paul, Minn., is at www.lawson.com.

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