SAP heralds end of middleware

12 Aug 2004

The first wave of software development was about building business applications that performed specific functions but could not talk to each other. The second wave was about software systems – so-called middleware – that could help companies make sense of their spaghetti junction of software. Get ready for the third wave: software with built-in integration capabilities, meaning that organisations no longer have to throw money and manpower at complex integration projects.

This may be a simplistic view of SAP’s strategy but the German software giant – best known for its military-grade business applications – is confident that the death knell for middleware has been sounded. In a recent briefing with journalists in Dublin, Simon Harrison, chief technology officer, SAP UK and Ireland, predicted that in a relatively short period (two to three years) the term middleware would all but disappear. “Our view is that middleware won’t exist but will be subsumed within the broader application capability,” he says.

But if middleware is to fade away, what will replace it? SAP believes it has the answer: SAP NetWeaver 04.

“An application and integration platform that easily facilitates the integration of people, information and business processes across organisational boundaries” is SAP’s official definition of its latest technology platform, launched globally in April this year.

Billed as SAP’s most significant release since it introduced the R/3 enterprise resource planning (ERP) suite in the mid-Nineties, NetWeaver contains a range of components or programs. These include SAP Business Intelligence, a data-mining tool to analyse data from different sources and SAP Enterprise Portal, which gives customers a single view of the various business processes happening within their organisation via a web browser. Another key component, Master Data Management, is designed to keep key data such as prices consistent across a multitude of business applications.

Paradoxically, NetWeaver has itself been widely described as middleware and, in functional terms, that is exactly what it does: integrate disparate systems. So in writing off middleware is SAP playing word games to boost its latest technology platform or does NetWeaver really represent something new and different?

To explain what NetWeaver does, Harrison uses the analogy of computer hardware evolution. “Technology is all about integration. If you take this computer,” he says, pointing at the laptop before him, “it’s a powerful device but I have my Wi-Fi card sitting outside it. The next version of it will have the card built in but it will still have a slot for a 3G card. That’s the same with SAP: we want to extend that integration outwards because it’s a pain having to think about that stuff.”

But the NetWeaver concept is about more than simply extending the opportunities for integration. It is being touted as the technology platform that will form the basis of what is known as services-oriented architecture or SOA, the successor to the client-server architecture that has prevailed since the mainframe went out of fashion. The benefits for the customer of SOA are that it allows new business processes to be deployed more flexibly and more cost effectively than ever before. “There is a greater need for IT systems to be more adaptable and aligned with business processes,” Harrison maintains.

Sandra Rogers, director of web services and integration software at IDC in Boston, agrees, noting that considerable momentum has built up behind SOA. “The entire marketplace has embraced SOA and web services architecture. Flexibility and adaptivity are what users are looking for. Users want to deploy services that best meet their needs at a given point in time.”

She feels that there is growing interest in products such as NetWeaver that address the issue of complexity within enterprise systems. “The expense of running multiple proprietary systems and the in-house resources needed to run those are an issue,” she remarks.

To begin with, NetWeaver is being targeted at SAP’s existing customer base. So far, 14,000 NetWeaver components have been shipped globally, although this does not equate directly to customer numbers because a single customer may buy more than one component. The company is bullish about NetWeaver’s prospects, pointing out that its sales targets for 2004 have already been exceeded.

Here in Ireland, Fiona Walsh, country sales manager of SAP Ireland, reveals that one customer, a large unidentified grocery retailer, has just gone live with the system, which is being used to share data across different stores and with suppliers. She adds that discussions are under way with several other potential takers.

So how much does NetWeaver cost? That depends on what SAP systems you are using already. Users of MySAP ERP and MySAP Business Suite have access to most NetWeaver components because these latest SAP systems are built on NetWeaver. For users of the older SAP R/3 system, the benefits of NetWeaver are being given as a compelling reason to upgrade to the latest systems. But rather than dwell on the cost of NetWeaver, SAP much prefers to emphasise the cost savings that will result from using it. The company reckons that an organisation can cut its integration costs by 15-20pc compared to traditional integration methods that use ‘point’ software solutions from third parties. The product also delivers a more rapid return on investment, the company argues.

“We have one customer in the UK using the portal to share information with suppliers and customers and it’s allowed them to slash their inventory. Never mind cost of ownership, the business benefits have been enormous,” says Harrison.

Only time will tell if NetWeaver turns out to be the paradigm-shift SAP claims it to be. But it seems to be yet another example of the company’s ability to catch the mood of the market. By promising an excellent return on investment and an end to software integration nightmares, NetWeaver is pressing all the right buttons with beleaguered CIOs.

By Brian Skelly

Pictured are Fiona Walsh, SAP Ireland’s country sales manager, and Simon Harrison, chief technology officer, SAP UK and Ireland