SAP buys Sybase - but why?

German database maker SAP went on a shopping spree last week to buy in rather than build up a mobile platform maker to bolt onto its already bloated business. But why did it drop close to $6bn on Sybase? It was arguably the biggest pure tech news story of the past week, in which German database giant SAP shook money out of its …

[Anonymous Coward]

SAP needs to find a decent UI designer

The whole SAP business system UI appears carefully designed to be impenetrable and almost unusable, so maybe they are hoping that Sybase can rip the cruft SAP made off the front of their middleware and put something usable there instead?

Dunno whether Sybase is a good candidate for that though, as I've never used their products.

More likely they're just consuming potential competitors, worried that the mess that has been made of almost every SAP installation (including some very high profile major screwups like Levi-Strauss) might be pushing businesses into using small suppliers instead.

I have seen a lot of ads in airports recently for 'small-supplier' business systems - given the way SAP advertises, they may have got scared.

[Anonymous Coward]

complex event processing

CEP is taking over the world, any big systems company without a decent offering is dead weight. Sybase recently aquired Aleri, which is a leading CEP developer.

[MetalJon]

How about a little research, hm?

Apparently, the author has never even heard of SAP--"German database maker SAP," "German database giant SAP"--SAP doesn't offer a database product; they're a software services company and their primary product is only the best known ERP in the world. Not sure I even want to read the rest when the article starts out like this.

[Anonymous Coward]

Er, say what?

What do sap and sybase have to do with anything ``mobile''?

One makes a bloated multi-nodular blob of software goo that keeps Highly Paid Consultants in eternal demand, and the other might be used to keep the data for the goo. So. Mobile? What?

Oracle buys sun and with it mysql, which I don't see the synergy of but what the hell. Just spending the cash on larry landing late again must get boring. Informix got borged by big blue, and presumably the db2 division people know what good it did them. SAP might want to make sure it doesn't get deprived of database access because most of them are now owned by some ``vertical'' dinosaur venture, and now we know what risk they're willing to take to secure that.

Of all the big database happenings lately this may make the most sense, but that isn't saying a lot. Colour me confused. Not that I claim to be an industry insider or anything, mind. Do we have a larry watcher or two in the house?

Paris, because ignorance here is so much less confusing.

[Anonymous Coward]

Sybase has a number of mobile products

Embedded database, data polling and others. Prior to the take over they were trying to push their mobile products strongly.

[John Gamble]

Re: Sybase has a number of mobile products

In fact, it goes back to the 1999 or 2000 Palm days when they had notification software for DBAs (not a database itself, but it allowed an off-site DBA to take some limited actions).

So yeah, Sybase has been in this arena for a long while. My only annoyance with them back in Ye Olde Past Centurie was their use of their own non-standard operators for outer joins.

[kissingthecarpet]

MS SQL Server

Perhaps worth pointing out that MS's SQL Server was based on Sybase's own database & they still share a lot of similarities in SQL syntax,underlying architecture & internal protocols. Their versions of SQL are both called T-SQL(Transact SQL). Owning a cross-platform pet enterprise quality SQL DB (that has lots of Java support) , will surely reduce their reliance on MS, improve optimisation & integration & give them a bigger profit margin to play with, if their customers aren't put off by the "not MS" tag.

So maybe it's about MS as much as Oracle - I'm no expert though, so all this is probably rubbish

[Kevin Bailey]

Good point

And if Sybase can run on a non MS OS then that would be a big plus for the serious users.

[Anonymous Coward]

Related, but only in the way that a gocart and a car are

Sybase and SQL Server come from the same bloodline, and were very close up until about version 4 (ie about 15 years ago) but they long, looooong since diverged, even in the engine. Sybase was always a damn fine database though. Used to be very popular in financial markets, at least until the Oracle dudes came knocking with their deep pockets and deeper discounts.

[Anonymous Coward]

Yeah, in memory tech some other time

Sybase market share may be small, but it is nearly 100% financial institutions and nearly all of them partial or full Oracle refuseniks. My giving it a supporting shoulder SAP makes sure that Oracle has more difficulties to make further inroads into its territory.

[Anonymous Coward]

SAP's been there before

in 2005 or so, they worked closely with MySQL to make an inexpensive alternative to Oracle for SAP back-ends. It apparently broke apart, with SAP "taking home" MaxDB which had been to handed to MySQL for a few years. I seem to recall that they also co-opted in making MySQL a direct back-end to SAP, but failed.

And now, of course, Larry owns MySQL which would have made that exercise moot anyway if the end goal for SAP is to give their customers a non-Oracle alternative.

[John Smith 19]

Did someone mention bloated Germans?

Too many pastries?

On a slightly more relevant point SAP coined the term "ERP" back when they were a mainframe accounts package supplier.

Database wise they *were* fairly neutral.

That might change a bit now.

[SAP Sybase]

Are you smoking dope ... or paid by Oracle ...

The logic is simple. Not sure why or how you are missing it. In 1995 also, SAP was looking for another DB, apart from DB2 to host stuff. Oracle ended up becoming the choice on open platforms with many SAP environments hosted on Oracle. By buying Sybase they can start bundling it as the DB of choice. One license that they sell for Sybase ... is a 2x win for SAP v/s Oracle (One sold for Sybase and One NOT sold for Oracle). It does not get better than that. It can always follow that up with more buys on the middleware side ... (although NetWeaver isn't exactly a bad platform ...)

[Anonymous Coward]

Interesting

So Kelly, with your vast Tech M&A experience what do you think the value should be?

[Anonymous Coward]

Low Quality Article

First, SAP is not a "database company", because they make the vast majority of their revenue with an ERP product, SAP/R3. Their database product SAPDB / MaxDB does not generate much revenue, despite the fact that it is a very good product.

Secondly, Sybase is not an obscure company - everyone who knows RDBMSs knows the name Sybase. After all, it is the source of MS SQL Server technology.

The strategy seems to be to attack Oracle in the database sector, know that they encroach on SAPs territory with Oracle ERP systems. Whether they can pull it off, I don't know, but this Reg article is like the crap Lewis produces when he writes about things like Eurofighter or A400M. The only "objective" thing is the objective to discredit European inventions. Because Everything From Merkina Is Better Than The Wicked Euopean Socialist Stuff.

[Is it me?]

Has SAP got the vision?

Sybase is a good database, it doesn't have all the bells and whistles that Oracle does, but then who does. Buy Sybase also has some other good tools in its portfolio that SAP could capitalize on.

Oracle underpins a lot of SAP sales, and with Sybase, SAP have an oppertunity to sell the database with the product, or at least say well we'll throw in this excellant commercial database product for peanuts with our product, and save you the cost of the Oracle licence.

Oracle sale people can be quite generous on their technology licences, when there's an apps sale. Now SAP can match that.

Oh and for those really old hands, remember Watcom SQL, which came to Sybase via Powerbuilder. Now there was a great, fully featured SQL database that ran in very little memory, in fact I seem to remember there was a Palm version of it, and was still in the Sybase catalogue last time I looked, but called SYBASE iAnywhere, certainly a hell of a lot more stable than the Oracle offering.

[Mage]

SAP

The main problem with SAP is that their ERP is too expensive and UI clunky.

I'd never have thought of them as a DB company, Simply to have their own MS-SQL like DB to bundle with SAP ERP this sort of makes sense.

But the price seems way too high.

AFAIK there is no older MS-SQL than 6 as it's based on Sybase. Surprised that Sybase are still around and not gobbled by MS. I assumed they were, like visio etc.

[BeefStirFry]

Paid over the odds...

SAP are paying 44% over the top of the Sybase share price... Wonder if putting techies at the top of company has influenced this? Last time SAP splashed out $6bn was the acquisition of Business Objects, which if they'd waited 12 months, they'd have got a lot cheaper after the market collapse.

We are still waiting for the promised "Pioneer" software release two and a half years later and apart from the SAP Business Objects Explorer which is really just a Business Objects onDemand piece of software, there has been not a lot of change in SAP BI/BW, they just repackaged the Crystal Reports and Xcelsius to make them work better with BW.

Its almost like SAP felt they had to buy something to hide the fact that they are really struggling to come up with anything innovative themselves. So maybe this is just be an attempt to buy talented and creative employees. Very expensive though, especially if the markets go down again...

[Anonymous Coward]

Business Objects....

"Last time SAP splashed out $6bn was the acquisition of Business Objects, which if they'd waited 12 months, they'd have got a lot cheaper after the market collapse."

Yeah, if you had a time machine you could travel into the future and gather some intelligence. And if pigs had wings they would drop their brown stuff in our faces.

Business Objects has been a very successful acquisition for SAP, similar to Lotus or Tivoli were for IBM. These big companies understand that a good business with good technology IS expensive. But maybe well worth tons of money.

Dassault Systemes gave IBM a 50% comission on each dollar of CATIA revenue generated by IBM. In their (IBM's) huge worldwide sales organization, of course. Now DS are the market leader in CAD/CAE/PLM. An expensive, but very, very smart decision, I think.

[Anonymous Coward]

SAP/R3

"The main problem with SAP is that their ERP is too expensive and UI clunky"

The main problem with BMWs seems to be that they are too expensive and heavy gas-guzzlers. The upside is that world&dog wants to drive a BMW and is willing to pay a lot of money.

SAP apparently is the best ERP solution around, otherwise they would certainly not be the No 1 ERP vendor. IBM Mainframes are also clunky and expensive, but they do the job they are intended for - running the core IT of big corporations.

SAP has all the features big companies need and it is proven to work. The fact that it could be even better does not change anything about that. Oracle and MS are simply unable to compete on all aspects with SAP and that's why SAP is the market leader. Build something better and please come back when you are finished, which is probably in about 10 years.

[Anonymous Coward]

Best?

"SAP apparently is the best ERP solution around, otherwise they would certainly not be the No 1 ERP vendor."

Probably because the users don't have a say in what is bought.

[None-of-the-Above]

It's all about mobile capablity

Please ignore the database side of this. The current SAP suite of products is only supported by 4 DMBS vendors - IBM, Oracle, Microsoft, and SAP itself (MaxDB, which has a fairly long history as ADABAS-D to SAPDB to MaxDB, but I digress). Notice that Sybase IS NOT a supported DBMS - this according to the current PAM (Platform Availability Matrix).

SAP is in need of a way to strategically support mobile connectivity to their solution. While mobile solutions for SAP have been available for nearly a decade (back to the Palm 7, if not earlier), it's a bigger need in today's market to have a strategic mobile solution, given the expected growth rate of mobile platforms like the iPhone, Android, iPAD, etc. In fact, SAP flushed much of their internal-only mobile solution in favour of partnering a few years back; Sybase was one of these partners - http://www.sybase.com/detail?id=1065930.

I am not saying this will be easy, or that Sybase will even remain a DBMS vendor; being a development partner with SAP may however have given the latter enough understanding of Sybase's technical capability for SAP to put up the funding to lock them in. Given that the Sybase DBMS is not supported for SAP applications, neither IBM or Microsoft are likely to complain much. I think we all know how much Oracle's opinion would matter here, as well.

The comments about the UI earlier are also on target, assuming the UI for the Sybase solution is a mobile one. The creation of effective mobile UI's was an area where SAP struggled with previous generations of mobile offerings. All fits, at least to me.