Oracle Corporation et al v. SAP AG et al
Filing
1206
Declaration of Nargues Motamed in Support of 1202 Statement Joint Statement in Support of Evidentiary Issues filed byOracle International Corporation. (Attachments: # 1 Exhibit A-0059, # 2 Exhibit A-6329-1, # 3 Exhibit A-0367, # 4 Exhibit A-5042, # 5 Exhibit A-5997, # 6 Exhibit A-6042-1, # 7 Exhibit A-6205-1, # 8 Exhibit A-5193, # 9 Exhibit A-5995, # 10 Exhibit A-5058, # 11 Exhibit A-5002-1, # 12 Exhibit A, # 13 Exhibit B, # 14 Exhibit C, # 15 Exhibit D, # 16 Exhibit E, # 17 Exhibit F, # 18 Exhibit G, # 19 Exhibit H, # 20 Exhibit I, # 21 Exhibit J, # 22 Exhibit K, # 23 Exhibit L, # 24 Exhibit M, # 25 Exhibit N, # 26 Exhibit PTX 0008, # 27 Exhibit PTX 0014, # 28 Exhibit PTX 0161, # 29 Exhibit O, # 30 Exhibit P, # 31 Exhibit Q, # 32 Exhibit R, # 33 Exhibit PTX 4809, # 34 Exhibit PTX 4819, # 35 Exhibit PTX 0012, # 36 Exhibit PTX 0024, # 37 Exhibit PTX 0960, # 38 Exhibit PTX 7028, # 39 Exhibit S, # 40 Exhibit T, # 41 Exhibit U, # 42 Exhibit V, # 43 Exhibit W, # 44 Exhibit PTX 8040, # 45 Exhibit PTX 2582, # 46 Exhibit X, # 47 Exhibit Y, # 48 Exhibit PTX 8112, # 49 Exhibit PTX 8111, # 50 Exhibit PTX 8108)(Related document(s) 1202 ) (Howard, Geoffrey) (Filed on 8/2/2012)
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SAPAG
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Case #: 07-cv-01658-PJH
PLNTF EXHIBIT NO. 0023
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.~
,.
OPERATOR:
Thank you so much.
Ladies arid gentlemen, thanks for
standing by, and welcome to the SAP Press call.
At this
time, all participants are in a listen-only mode.
If you
should require assistance durlng the call, please press star,
then zero.
As a reminder, this conference is being recorded.
Also, during the question and answer session, you would need
to depress star, zero.
I would now like to turn the
conference over to our host, BILL WaHL, Vice President of
Product Public Relations.
Please go ahead
MR. BILL WaHL:
Thank you very much.
Good morning, and good
afternoon from Waldorf.
This is Bill Wohl of SAP, and
welcbme to our media teleconference and web cast.
I'm joined
today by Bill McDermott, President and CEO of SAP America,
who is joining us from Washington, D.C., and Shai Agassi,
member of the SAP, A.G. Executive Board who is here with me
in Walldorf.
The purpose of today's media telephone
conference call is to summarize SAP's anRouncement this
morning of a comprehensive offering for SAP customers who are
also running instances of PeopleSoft and/or JD Edwards
software.
An offering which provides options and safety for
those customers concern~d about Oracle's takeover of those
businesses.
SAP's announcement was distributed on the PR
Newswire at eight o'clock this morning, Central European
Time, and is currently posted on our press website at
SAP.com/press.
I'd like now to review the agenda for today's
call and web cast.
In a moment, I'll invite Bill McDermott
to take a few minutes to preview today's announcement
details, and provide his perspectivfr on our safe passage,
customer-focused offering.
Shai Agassi will then provide
some context on the role of SAP NetWeaver, in providing an
important integration bBnefit for these customers, and then
we'll take some questions and answers.
We understand that
there is a demand for SAP to comment on announcements made
yesterday by Oracle.
As a market leader, we don't feel the
need to respond to Oracle on a point-by-point basis.
However, as SAP has done in the past, we'll have some
comments at the conclusion of our presentation to provide the
market with some facts that challenge some of the
inaccuracies issued by the Oracle. team yesterday.
Before we
begin, I'd like to offer a few ground rules for today's call.
First, as you may know, SAP is in its quiet period, and we
will fully detail our fourth quarier and year-end results
next Thursday, January 26th.
As such, we're not going to
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comment on SAP results, nor make projections on future
business in this call.
Second, the purpose of our call today
is to highlight SAP's unique offering for its customers
running PeopleSoft and JD Edw9rds solutions.
We'll take
limited questions on the Oracle announcements.
Finally, I'd
like to remind participants that the call is being recorded
for playback.
And now, I'd like to invite Bill McDermott to
offer some comments.
Bill?
MR. BILL McOERMOTT:
Thank you, Bill and good morning, ladies and
gentlemen.
I'm excited to discuss with you SAP's Safe
Passage program for 2005.
As you probably know, SAP is
making a strategic announcement today to give customers a
choice.
SAP customers that are also running PeopleSoft or
JOE, anywhere in their enterprise, now have a very compelling
offer to migrate to SAP.
Oracle's acquisition of PeopleSoft
and JOE is forcing customers to be very uncertain about the
future of this software system, and the support for those
systems, as well as the future product architecture.
Customers are telling us, time and again, that this is very
disruptive.
As Bill said, SAP is the market leader, and we
feel we have a responsibility to remain the 'industry's
trusted advisor, and to provide a comprehensive offering for
customers that are running PeopleSoft and/or JOE.
We are
calling this winning proposition our Safe Passage program.
Our offering includes maintenance and software support at 17
percent for PeopleSoft and JDE solutions.
Our proven
maintenance program provides security to these customers, so
that their solutions will be maintained while they also have
the flexibility to plan their software migration strategies
at their own pace, without the fear of unplanned maintenance
interruptions or forced migration.
Our customers are telling
us they don't want to go on any forced marches.
So, to
accelerate this offering, SAP has acquired Tomorrow Now, the
industry's most lexperienced third-party maintenance provider.
Tomorrow Now is already providing reliable support for JOE
and PeopleSoft customers.
They bring important skills and
experience to our business.
Nearly 100 Fortune 500 midmarket and public sector entities, from just about every
industry sector, have already selected Tomor:r:ow Now as their
mission-critical, enterprise software maintenance and support
provider.
We are very excited to welcome Tomorrow Now's
customers to SAP.
Our Safe Passage program has three key
components.
Let me spell them out for you.
One: a
maintenance offering on existing investments customers have
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made in PeopleSoft and JDE.
Two: extension through SAP
NetWeaver; and three: migration to mySAP ERP.
Under the
program, companies can extend their I.T. infrastructure with
SAP's NetWeaver integration p~atform, which includes already
proven JDE and PeopleSoft connectors.
Customers will get the
immediate result of better integration of their entire I.T.
landscape with one completely open and scalable platform.
Customers gain the benefits of NetWeaver and maintenance
support for PeopleSoft and JDE solutions by licensing mySAP
ERP, which has proven to be SAP's best-in-class solution.
They can migrate to mySAP ERP now, or choose to do so in the
future, when they are ready.
By acting on our Safe Passage
program in 2005, SAP will provide a full, 75 percent trade-in
credit for PeopleSoft and JDE licenses, providing key
investment protection to these customers.
You should know
that this is simply an extension of the program we currently
offer SAP customers for upgrading their systems to SAP
solutions.
In this case, we're calling it mySAP ERP.
So to
net it out, we're treating PeopleSoft and JDE customers with
the same loyalty and respect that we treat our own SAP
customers.
According to analyst estimates,. there are
approximately 4,000 companies running both SAP and PeopleSoft
I JDE. Customers and analysts have told us that there will
be strong interest by most of these companies in our program,
as many of these customers have already made the strategic
decision to migrate to SAP over time.
This Safe Passage
program significantly accelerates the migration to SAP by
lowering total cost of ownership now.
Based on my
conversation with customers over the past 18 months,
customers have exhibited extraordinary concern about the
future of brands such as Oracle, PeopleSoft, and JDE.
Now
that the unc~rtainty about· this hostile takeover is behind
us, customers seem even more concerned about the future of
their past investments, as well as JDE, OracleSoft vision,
for an entirely new solution built from scratch that may be
available somewhere between 2008 and 2013.
Hey, the
customers I talk to are trying to run their business today.
Customers want a trusted innovator.
Customers want a real
pass forward.
Customers want real solutions today, and that
is why SAP has remained the undisputed market leader and the
safe harbor in a consolidating, maturing market.
Finally,
today's announcement is about SAP keeping our promise to
customers.
That remains our foremost priority.
our vision,
to enable every customer to become a best-run business is
what SAP is all about.
While this announcement is targeted
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at SAP c~stomers that are also running PeopleSoft and JDE,
based on1the significant interest by customers we have
received:so far, we will be expanding this program further in
2005, so. stay tuned for furth~r announcements.
Now, I'd like
to turn it over to Shai for his perspective.
MR. SHAI AGASS I:
Thanks, Bill.
I'd Ii ke to take a bit of a
product ~erspective on this, and I'd like to first speak on
the role'of SAP NetWeaver in this offering.
For customers
that are running solutions from multiple vendors, the cost of
integrat~ons are extremely high and very well known.
They
represent probably the largest drain on available dollars for
innoyation, and business process innovation is what brings
value in~o businesses, not pure migration or integration
projects~
Our aim in this offer is to provide three direct
services' for this customer segment that we talk about, the
joint SAP, PeopleSoft, JD Edwards customers.
First of all,
maintenahce support on the JDE investment, PeopleSoft
solutions for a long-term, for this reliable, and certain,
and making sure the companies can be assured that their
investmerit is protected and the products a~e maintained, that
you're n?t forced to change if you don't wa~t to.
Secondly,
offer customers the SAP NetWeaver platform for integration,
which co~es with the JD Edwards and PeopleSoft proven
connecto~s so they can realize the immediate benefits with
more-easily integrated enterprise across their entire I.T.
environm~nt, and they can do it today and not wait for
platforms to show up'. down the road.
Third, we provide a
clear roadmap to the" next generation solutions, namely the
leading ERP package in the market today, mySAP ERP.
More
importantly, we don't force them to do the switch, we let
them do the switch, we let them decide when they want to
migrate, and we offer them services and package migration so
that they can do it at their timetable and at the lowest cost
possible for their business.
SAP NetWeaver is the way that
we can help PeopleSoft and JD Edwards customers to
immediately extract more value from their current investment,
and for running and composing new, innovative processes
ac~oss heterogeneous applications infrastructure, which
includes SAP, includes PeopleSoft, includes JD Edwards, and
includes other applications that they have in their
landscape, today and in the future.
This way, we believe
that the customers can actually get flexibility.
First of
all, enable the next wave of innovation in business process,
second, ease of transition, and third, consolidate the
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multitude of technology point solutions that they actually
have today into a single, integrated stack that is proven
standards-based and open.
SAP NetWeaver today is being used
by thousands of custorners~ a~d we have today more than 1,500
reference customers today.
And to be in reference, the
customer has to use SAP NetWeaver in a comprehensive usage of
multiple components and layers of the infrastructure, as well
as integrate SAP and non-SAP solutions.
As a result of that,
you understand that NetWeaver today is used by thousands of
customers, and not just on SAP products, but also on non-SAP
applications, which is the normal challenge customers face
every day.
I want to summarize the Safe Passage program for
2005- that Bill just highlighted.
One: a considerably better
opportunity for our customers; better than other third-party
offerings because one support group can support all your
applications with one phone number, one relationship, one
responsible party.
Two: SAP assumes the complete
responsibility for maintenance, service,. and support.issues
across all the customers' SAP, PeopleSoft, and JD Edwards
landscapes.
SAP's mainstream and standard maintenance price
is only 17 percent, lower than the other oLferings in the
market.
Three: the customer actually gains immediate
integration benefits.
They don't need to wait for a
platform,they get SAP NetWeaver today.
It allows them to
extend the life of their existing investment in PeopleSoft,
and it allows them to continue·to innovate, which is the
highest cost of a business.
If the business cannot innovate,
they pay a lot more than maintenance, they pay a lot more
than implementation.
Finally, we define a clear roadmap.
One that is based in reality, one that is based on products
that exist, that are available, that are running, that are
referenceable today.
These products are the market leaders.
mySAP ERP, a service-oriented platform based on standards and
SAP NetWeaver, and next generation, innovation applications
such as SAP Excess.
Customers get to choose the time of
migration, their direction of deployment, and their wish and
innovation.
It's a plan to protect the interests of our
customers.
It's not a competitive offering, it's a market
leading offering.
We believe that software companies don't
own customers, we can't trade in our customer, you can't sell
customers, you can't buy customers.
You can only serve their
interests.
We believe that we're serving their interests to
the best possible way today.
I know that Bill is very
excited about this offer, as the U.S. market is probably the
key battleground for us today.
We believe that this effort
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will be the first one in the market, and we believe that
we'll be focused on extending our leadership in this market.
What Bill has done over the last two years in the North
American region, by keeping, and maintenance, and extending
our leadership as the number one enterprise application
vendor, has never been done before.
During those last 18
months, Bill has made sure that even the combined entity of
PeopleSoft, and JD Edwards, and Oracle, cannot reach the same
revenue numbers that Bill and his team have successfully
reached over the last 12 months in North America.
From my
viewpoint as an executive board member at SAP, I want to
offer a couple of quick comments on yesterday's events, and
as the market leader, we don't respond and don't spend too
much time on commenting on the competition, but I think you
have to summarize 18 months of paying attention to a lot of
different things that happened in this market, and I think
while Oracle was trying to spend their billions of dollars on
buying market share, we've been saying little.
We didn't
think that it will add value to send more messages into this
already confused market.
As Bill said, we focused on our
customer, and our customer's business, and 9ur customer's
success.
As we've done in the past, we actually believe that
it's our obligation to clear up misconceptions, and clear up
inaccuracies, and imaginary numbers that were brought to the
market by Oracle about SAP and about the rest of this market.
But I'd like to clear up a few things delivered yesterday by
the JD OracleSoft.
While our competition has laid out a very
ambitious agenda for JD OracleSoft, I'd like to contrast the
two positions.
Oracle's made a promise to build, from
scratch, a completely new set of tools, a platform to support
those tools, and then build a whole new set of applications
in JAVA from scratch with a team that has never built
applications in JAVA before.
We actually believe that this
2013 goal is highly optimistic.
We also believe that·SAP is
delivering solutions to the market and to their customers
today.
We're shipping a service-oriented open integration
and application platform in SAP NetWeaver that already has
thousands of customers deployed~ and 1,500 reference
customers willing to speak about the value they're getting,
the benefits, and their current model of deployment.
They're
well-established, and we are well-established, as marketleading and we established best practices around this
platform.
This is not an imaginary PowerPoint presentation.
We've also made some very ambitious promises that we have
delivered.
On the other hand, we've seen some promises on
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.~
the other side that are still too far in the future to
comment on at this point.
We've delivered a standards-based,
integrated platform to our customers since 2003.
We've also
heard some conversation about standard-based and openness
yesterday, and I'd like to correct some of the misconceptions
that were thrown around the room.
I think that SAP is
delivering a platform which is the only one that truly
supports JAVA, J2EE, and .net in one environment.
When we
first announced NetWeaver two years ago, we were not alone on
this stage.
We had Bill Gates, we had Bruce Harold from IBM.
We actually continued to evolve these relationships and we
have continued to deliver products that can extend to both
J2EE., as well as .Net.
I did not hear yesterday any support
for openness from our colleagues at Oracle.
I hear, on the
other hand, that they're going to combine some way, the
database and the applications, yet they will not open up to
other databases.
I heard the HTML and HTML, but I didn't
hear any support to Windows-smart clients.
These are not
openness issues, this is locking a customer into a one, very,
very tightly welded, [unintelligible] platform.
Finally, I
would like to comment again on our announce~ent. We see a
lot of opportunity for SAP in capturing market share.
We see
that, in order to capture this market share, we need to
continue to do exactly what we did over the last 18 months,
serve customers.
It's very simple, very straightforward.
Today's announcement is focus on providing a viable choice in
the security fo~ SAP customers running JD Edwards and
PeopleSo£t.
But you can expect SAP to target other customers
in other segments down the road.
Thank you, very much.
MR. BILL WOHL:
Thank you, Shai, and thank you, Bill McDermott.
In a moment we'll take a few questions.
Callers will signal
the operator, who will in a moment describe the process for
that.
I'd like to remind all the callers and people on the
web that today's event is primarily focused on our
announcement, and we intend to focus questions on that area.
We'll take a few questions on other areas as time permits.
As indicated before, SAP remains in a quiet period, so
questions on earnings, projections, or other financial
matters will not be addressed in this conference call.
If
you're joining us on the web, you may send qu~stions to us at
SAP at press@sap.com, and we will do our best with the time
remaining in the day to respond with answers.
And now,
operator, we'll open the call for questions.
And we need the
operator, who is probably opening the call for questions as
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we speak.
OPERATOR: Yes, sir.
Thank you.
Ladies and gentlemen, if you
wish to ask a question, please press star, then one.
I'm
sorry, please press star, the zero.
You will hear an
acknowledgment tone.
If you are using a speakerphone; please
pi~k up the handset before pressing the numbers.
Once again,
if you have a question, star, zero at this time.
MR. RILL WOHL:
And one thing that the callers can do to help us,
while we're waiting for the queue to fill, is if you could
give us your name and your media affiliation or your analyst
firm, that would help us keep track of the questions, in case
we have to respond with more complete information.
I would
also remind folks that the press release is on the website,
and there's additional information for customer inquiries at
SAP.com!safepassage.
OPERATOR: And we have a question from the "line of Tad Piper with
Piper Jaffray.
Please go ahead.
MR. TAD PIPER:
Thanks, guys.
A couple of quick, clarifying
questions.
Is access to NetWeaver covered oy this 17 percent
maintenance rate at no additional charge, or is there an
additional fee to actually license NetWeaver? That's my
first question.
Then my second one is: what was the rate
that Tomorrow Now was charging? Was it as high as 17
percent, or will this actually be somewhat of a price
increase from Tomorrow Now's prevailing prices? Thanks.
MR. SHAI AGASSI:
Let me take that question, Tad.
The package
contains a migration to mySAP ERP.
When you buy the
migration, you get 75 percent credit towards your past
investment in JD Edwarda and PeopleSoft, you get license
rights to mySAP ERP, which include your license rights to
NetWeaver in that package, at which point you get a 17
percent maintenance that covers your ERP, your NetWeaver, and
your PeopleSoft investment at that point.
So the overall and
over encompassing package from SAP will offer NetWeaver, ERP
migration, and maintenance in the package for the same price.
Tomorrow Now's rate has been 10 percent for only maintenance
and bug fixes on PeopleSoft and JD Edwards soEtware.
It does
not include the migration package, does not include the
NetWeaver offering, and Tomorrow Now will continue to offer
that package to customers who do not ~ant to migrate, just
want to park their investment on PeopleSoft, JD Edwards.
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MR. TAD PIPER:
Thanks.
MR. BILL WOHL:
Thanks.
Next question, please?
OPERATOR:
Our next question comes, from the line of Ross MacMillan
with Morgan Stanley.
Please go ahead.
MR. ROSS MACMILLAN:
Yeah, thanks.
I was just curious as to
Tomorrow Now's support.
As we get other, you know, new
releases coming through here [unintelligible] and beyond, are
you going to be able to support those products from the base?
Are you going to be able to support the new versions that
come through from the Oracle, PeopleS oft combination?
Thanks.
MR. SHAI AGASSI:
All right.
So we can only comment on the
products that are in the market today.
We don't know what
Oracle products in the future will be, so the only thing that
we can tell you is that we support the products that are in
the market today at the date of the acquisition.
We'll see
down the road what these unannounced products will be.
We
don't know what is the 9.0 product.
I don't think anybody
knows right now what is the 9.0 product.
MR. ROSS MACMILLAN:
MR. BILL WOHL:
Okay.
Thanks.
Thanks.
Next question, please?
OPERATOR:
Our next question comes from Bill Swanson with AMI
Research.
Please go ahead.
MR. BILL SWANSON:
Hi, gentlemen.
Very surprising kind.of
announcement, but should be interesting.
Following up on the
question about what exactly you're buying, could you go
through what i t takes to take advantage of this.
Do I simply
sign up for maintenance and 17 percent and then I get those
migration rights? Or is there also relicensing required at
this time?
MR. BILL WOHL:
Sure.
We can do that.
want to walk him through that?
Bill McDermott, do you
MR. BILL McDERMOTT:
The client would sign ·up for mySAP
Sure.
ERP.
We would provide a 7S percent trade-in credit to the
PeopleSoft, JD Edwards investment.
MR. BILL SWANSON:
MR. BILL McDERMOTT:
Okay.
And we would charge the maintenance of 17
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4
percent on the value of the mySAP ERP license, which also
includes the NetWeaver platform.
And for that same 17
percent, while the client is migrating to the implementation
of mySAP ERP, we will also ma~ntain their PeopleSoft, JDE
installed through Tomorrow Now.
MR. BILL SWANSON:
Okay. Do you also intend to use
[unintelligible] continue to offer, do you intend to try to
build that Tomorrow Now business for those customers that you
want to [unintelligible] SAP customers?
MR. BILL McDERMOTT:
One example of a customer I saw yesterday,
and I think what customers are looking for, many of the
customers where we're co-existing now, which is our primary
focus, they already had a strategic roadmap to migrate to SAP
over time.
So what this is doing, in 2005, we have this
offer on the table.
It's accelerating the buying window for
our clients to make the mySAP ERP supported by NetWeaver
choice now, because they get the maintenance coverage now for
the PeopleSoft JDE licenses that they procured, and SAP
begins the strategic mapping of their new implementation at
the time in the future when they are ready to do it.
So I
talked to a client yesterday who was very, very excited and
compelled to move on this quickly.
MR. BILL SWANSON:
MR. BILL McDERMOTT:
MR. BILL WOHL:
Very good.
Thank you.
Thank you.
Thanks, Bill.
OPERATOR: And our next question comes from Charles Babcock with
Info Week.
Please go ahead.
MR. CHARLES BABCOCK:
This is Charlie Babcock, Information Week,
and I wondered how you would respond to Larr~ Ellison's
charges that ABAP is a proprietary platform, as opposed to
JAVA.
I think you have some kind of answer to that.
MR. SHAI AGASSI:
Yeah, let me take that.
I think that we have
multiple different directions.
I think one thing that was
said yesterday is that we do not have a standard space
offering, that we're starting to build NetWeaver from
scratch, that we only support ABAP.
There were a lot of
different claims that were made, sort of off-hand remarks by .
Oracle yesterday.
I think that the truth has to be told, and
I think one, we have a platform, NetWeaver, that is a rnarket-
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<.
leading platform that supports AVAP and JAVA.
It's a full,
J2EE standards based, secure, op~n, and it's integrated and
interoperable with .net.
So if we're talking about who is
more open and who is more proprietary, I think that we have
to really discuss the reality of life that we are the most
open platform, bar none, in the market.
We also talked about
standard based tools.
Our tool offering, within NetWeaver,
is based on Eclipse, which is actually the largest standards
based open technology for development tools.
Oracle's
offering is based on a proprietary version of J Builder.
So
when we talk about proprietary versus standards based tools,
I think we have to stick to reality.
Finally, if you look at
the market and you actually run an analysis on customer's
investment, you can take one of two paths.
The first path is
to say, we're sorry, you're going to have to forget about all
your investments in the past.
The fact that you have
applications that have been customized with People Code, or
applications that have been customized with Oracle Forms, or
that it's been built with a PL sequel, which, as far as I
remember, are all proprietary, you have to forget about them.
We're going to start from scratch, and we're going to get
there at some point in the future.
What we've done is we've
basically looked at the reality of life.
Customers have a
very large investment in applications that are built in ABAP,
which is a 4TL language.
It is a very high value proposition
for them that we can maintain this investment, we can extend
it, we can service enable it, and we allow them to continue
to compose applications, build new innovation, in JAVA, in an
open environment, on top of all their ABAP investment, not
just our ABAP investment.
And when you look at that, I
actually think that our collection of business objects
processes, In AVAP, is not something to be laughed at.
It's
the largest asset in the enterprise applications business.
MR. BILL WOHL:
Does that help,
MR. CHARLES BABCOCK:
MR. BILL WOHL:
please?
Charli~?
Sounds good.
Thank you for your question.
OPERATOR:
We'll go to Kash Rangan with
ahead.
Next question,
Wachovi~.
Please go
MR. KASH RANGAN:
All right.
Thank you very much.
Question for
Bill McDermott, or whoever might be appropriate for this
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question.
One, is this program only applicable to clients of
Tomorrow Now? That is, this migration option to. SAP which
includes the 75 percent credit.
And secondly, what was your
guys' thought process when you came up with this 75 percent
trade-in offer, vis-i-vis the economics of getting those
customers directly on your own, through your direct sales
channel.
Why would you not, I mean, 75 percent discount
seems like a pretty sizable haircut to pay.
But I'm just
wondering what your thought process was as to how you end up
making money, net, through this offer, vis-i-vis going direct
next.
MR. BILL McDERMOTT:
MR. KASH RANGIN:
Hi, Kash.
It's Bill.
How are you doing?
Good, how are you?
MR. BILL McDERMOTT:
Very good, thank you.
First and foremost,
the program, this initiative, follows the same logic as we
applied to our existing SAP customers, where we provide them
with an upgrade path to our newest platform.
And simply
stated, we wanted to apply the same loyalty and respect to
the PeopleSoft JDE customers that are out t~ere, as we do to
our own customers.
Especially in a time of uncertainty and
doubt, given the Oracle hostile takeover.
The second thing
is, in terms of the value proposition, while we have
prioritized SAP clients that also have PeopleSoft or JDE
installed, due to the early market receptivity to this offer,
we are more than likely going to have to extend beyond that,
and that'll baa further announcement coming down the road.
So, you know, the Tomorrow Now acquisition really helps us
hold over these PeopleSoft JDE customers, provide good
maintenance and support to them, while they are making the
migration to mySAP ERP with NetWeaver.
And it's giving them
a great choice, and we felt that the value proposition that
it negates should be very, very compelling, so we were clear
about how quickly we wanted to help these customers out.
MR. KASH RANGIN:
I got it.
So the assumption is that, then, a
similar program will be offered to clients that are
PeopleSoft, JD Edwards customers, but are not clients of
Tomorrow Now as well.
MR. BILL McDERMOTT:
No, no, no.
I think that a clarification is
worthwhile here.
Shai, you want to make that clear?
MR. SEAl AGASSI:
Yeah, just a clarification.
This offer is not
just for Tomorrow Now's customers.
This offer is for any
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SAP, PeopleSoft,
JD Edwards customer.
I got it.
MR. KASH RANGlN:
Okay.
MR. SHAl AGASSl:
And Tomorrow Now. is the vehicle throagh which
they get the maintenance services, not the customer-based
that we're going after.
It's also--it's not a 75 percent
discount, it's a 75 percent credit on their original
PeopleSoft, JD Edwards investment.
So as a result of that,
basically I think what we're looking at, and if y6u want to
look at it from sort of the financials perspect~ve, the
rationale is more around the value, if you want, that, these
customers represent as a potential future set of customers
for SAP applications.
And it's--the value was estimated by
Oracle, rightfully or wrongly, as $10 billion.
What we
believe is that this customer base is not necessarily captive
by Oracle.
I think this customer base has to make a choice
right now.
MR. KASH RANGIN:
Thanks, Shai.
And also the 17 percent
maintenance rate applies to the gross value of that
implementation, or is it the net of the 75 percent credit?
MR. SHAl AGASSl:
Let me take you through an example with numbers,
so we can understand.
Let's just db them for a second.
The
customer has a million dollar PeopleSoft contract that they
bought back in 2000, or back in '98.
They want to now go to
mySAP ERP on the equivalent number of seats with better
functionality and the ERP package.
They're looking probably
at around the same number, $1 million.
They get 75 percent
credit on their original million dollar acquisition, which
means they get $750,000 credit, and they pay up $250,000 to
get mySAP ERp and NetWeaver in the package, and their
maintenance from this point on is 17 percent on the million
dollars.
Meaning they're going down to $170,000, which is
less than the 22 percent that they were going to have to pay
if they go to Oracle.
MR. KASH RANGlN:
MR. BILL WOHL:
Got it.
That's useful.
Thanks for your question.
Next question?
OPERATOR:
Our next question comes from the line of Mark Sandini
with Computer World.
Please go ahead.
MR.· BILL WOHL:
Hi,
MR. MARK SANDINI:
Mark.
Hello.
I
had a couple of quick questions.
One
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was you guys are going to offer this maintenance program.
What will maintenance entail, and does that do anything more
than just bug fixes.
And also, would you allow PeopleSoft,
JD Edwards customers, or world customers, to keep their
existing licensing plans, or would they have to migrate to
some sort of mySAP ERP license?
MR. SHAl AGASSl:
They--so two things.
One, it entails not only
bug fixes, but also all the legal fixes and compliance
requirements that come from local, and state, and federal
requirements.
It also--we're not forcing them to withdraw
from their existing applications, so they can keep running
their applications, they have that license, and they can keep
going with it.
And they can decide at their time when they
want to get out of the current applications in effect.
We
didn't force them to be on the frozen state.
I think that
decision was made by somebody else for them.
The choice is
now for them, how do they go forward, and I think we're
giving them a choice to move forward in a positive way.
MR. MARK SANDINI:
When they do their migration though, to SAP,
would they have to convert to an SAP styled.license?
MR. SHAl AGASSl:
What is an SAP style license?
MR. MARK SANDINI:
Would it be--would they be able to keep the
same terms, even if their migrating to SAP, that they had
with PeopleSoft?
MR. SHAl AGASSI:
We have a standard mySAP ERP license, and we're
going to offer them that license, and they get the--they get
effectively a recognition for their previous investment.
We're not. going to create a new category of licensee.
We're
treating these guys just as good as we're treating an R3
customer that has been loyal to us for the last 30 years.
We're grandfathering them into the SAP family by virtue of
the fact that they are SAP customers.
MR. BILL WOHL: And Mark, it's probably worth noting a comment
that Bill made earlier in the call, that many of these are
customers in the SAP space who are already giving
consideration to solution migration.
They have the
additional challenge of figuring out what to do with their
PeopleSoft and JDE investments, and this plan gives them a
migration pass that covers all of them.
MR. MARK SANDINl:
Excellent.
Thank you.
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MR. BILL WOHL:
Thanks for your question, Mark.
OPERATOR:
The next question comes from Helen Lob [phonetic] with Financial Times.
Please go ahead.
MS. HELEN LOB:
Yes, hi.
I wanted to know how many technical or
maintenance support people you're taking over with the
Tomorrow Now acquisition, and also if this offering is only
for U.S.-based companies, or is it world-wide, or will you
expand it, or what's the--what are the details on that.
Thank you.
MR. SHAI AGASSI:
regi.onally?
Bill, you want to comment on the offer
I'll talk about Tomorrow Now.
MR. BILL McDERMOTT:
Sure.
I'd be glad to, Shai.
The offer is a
global offer.
We are focusing on the United States market
initially, because that is the market with the greatest
number of installations where PeopleSoft, JDE coexist with
SAP.
But it will not be limited to that;
We will expand the
program and the initiative globally.
Shai?
MR. SHAI AGASSI:
With regards to Tomorrow Now . . Tomorrow Now,
today, supports about 100 companies around the world, and
with this acquisition, they actually have access to a lot
more resources, as well as more skill sets, and knowledge,
and support capabilities from SAP's arsenal, if you want, of
resources and tools.
What we believe is that we will scale
Tomorrow Now with additional resources to meet the demand as
the demand comes in, to meet any number of customers that
will require our services.
We do not see a problem in
attaining resources in the market that have knowledge and
supporting PeopleSoft or JD Edwards at this point.
MS. HELEN LOB:
And what would that entail?
[Unintelligible] .
MR. SHAI AGASSI:
It's just ramping up as customers sign up.
There is an abundance of resources in the market as a result
of the last 18 months that actually have the skill set
required in order to support customers in the best possible
way.
MS. HELEN LOB:
MR. SHAIAGASSI:
MS. HELEN LOB:
So, more hirings?
Yeah, most likely.
Thank you.
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MR. BILL WaHL:
Thanks, Helen.
Next question.
OPERATOR: And that comes from the line of John McPeake, with
P.A.W. Partners.
Please go ahead.
MR. JOHN McPEAKE:
Thank you.
I'm just curious as to, you know,
the size of companies and the types of companies that are
using third party maintenance because, I guess, and one of
the nice things about maintenance from a software company's
perspective is, you know, you wrote the code, you know the
code, you know where the code is going.
I kind of wonder if
companies that are running mission-critical core applications
are actually going to be willing to go to a party who's not,
you know, sort of in the flow with respect to, you know,
where the product is headed.
And then I have a follow-up
quickly, a fter that.
[Unintelligible]· comment.
MR. SHAl AGASSl:
Yeah.
So, I think it's a great question.
I
think it speaks volumes to the difference between perception
and reality in the market.
If you look at the customer lists
that are supported today already by Tomorrow Now, you can
actually go to their web page at Tomorrow N~w. You can see
the list of customers.
We're talking about the largest
companies in the world.
Companies like Nestle, and Lockheed
Martin, Coors, EDS, large, very, very large public SEctor
customers, all of which are mission-critical on their
PeopleS oft and the JD Edwards implementations.
And when
you're. looking at ·these companies, you have to remember two
things.
One, they are, at some point, at a standstill on
their current version of their implementation.
And their-the incentive for them to move forward has just been
terminated yesterday with the--basically an announcement.
This is sort of end-of-life of these applications.
And so
most of these customers, especially the ones who are shared
customers between SAP, and PeopleSoft, and JD Edwards, know
that down the road, if they want to continue to innovate on
their mission-critical systems, they need to migrate.
When
you look at that question, you_
MR.
JOHN McPEAKE:
Do you see most of these companies though,
putting a portion of their CPUs or whoever they are licensing
i t , on Tomorrow Now and keeping an existing ma"intenance
agreement so they, you know, are in the information flow, or
are they moving entirely over to Tomorrow Now?
MR. SHAl AGASSI:
I think again, these are--it depends on the
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company, but most of the cases that we saw, they shift over
to Tomorrow Now, across the board.
MR. JOHN McPEAKE:
And then, this is a follow up.
I mean, you're
trying to leverage customers initially that have PeopleSoft
and SAP applications.
What percentage of SAP installations
have Oracle's database running on the back end?
MR. SHAI AGASSI:
Yeah, I see where you're going with the
question.
I think there's a very large discrepancy between
the connection between the database and the application, and
the connection between applications and platforms.
And I
don't think that matters to any degree whatsoever.
We do not
see any of our customers, who are on Oracle database,
questioning their relationship with SAP as significantly
higher value, more strategic to them.
We see, on the other
hand, a lot of them are looking at the database as more of a
commoditized offering, and it's may--if they have to make a
choice, they'll probably convert a database more so than they
will convert an application.
MR. JOHN McPEAKE:
But, I mean, if you look at t,he market share on
installed bases, you know, it's quite high.
Do you have a
sense? I think it's now 80 percent or something.
I just
imagine that ...
MR. SHAr AGASSI:
No, no.
It's significantly less than that.
It·' s in the--it's close to 60 at this time.
And...
MR. JOHN McPEAKE:
Sixty percent running on Oracle?
MR. SHAI AGASSI:
Yeah.
I think somewhere around that number.
And it's actually not a growing number.
We're seeing players
like Maya Skriell [phonetic] offering Max DO, corning into the
market and having a market share, and players like IBM, and
especially Microsoft with Equal Server at the mid-market
coming in and taking significant market share on the database
line. You have to remember, databases have been
commoditized, and tomorrow, you know, it's a standard SQL
interface.
MR. JOHN McPEAKE:
MR. SHAI AGASSI:
Like ...
MR. JOHN McPEAKE:
Yes.
It's not what it's being made of yesterday.
Well_
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MR. SHAI AGASSI:
Any of the other, quote, end quote, facts that
were related yesterday.
I think that you have to question
some of the validity of the statement.
MR. JOHN McPEAKE:
Right.
The only problem is it's not that easy
to move stored procedures and other things from one database
to another, and...
Don't forget that we do not use stored
MR. SHAI AGASSI:
Yeah.
procedures for our applications as a big, dominant effect.
Oracle's built their applications around PL Sequel, which is
the wrong architecture and the wrong approach to actually
build applications in this environment.
MR. JOHN McPEAKE:
All right.
MR. SHAI AGASSI:
It doesn't scale.
I mean, so you can actually
go down that path and as you can see, Oracle is strongly
trying to weld the application to the database.
It's not one
that has been--it's not an approach that ~as been successful,
as you can see.
The applications business has not taken off.
MR. JOHN McPEAKE:
MR. BILL WOHL:
Okay.
Thanks.
Thanks for your question.
OPERATOR: We'll go to the line of Carolyn April with Far
Business.
Please go ahead.
MS. CAROLYN APRIL:
Hi.
Thank you.
I was hoping you could
address the role that partners are going to play in this
initiative. A couple of questions.
One is whether Tomorrow
Now becomes sort of the exclusive provider of the maintenance
services, to the exclusion of existing SAP partners or
PeopleSoft partners.
I mean, in terms of the migration, I
mean, have you reached out at all to the PeopleSoft, JD
Edwards partners who may be able to play a role here? And
also, if you could address how this affects your own partners
as well.
MR. SHAI AGASSI:
Yeah, so first thing is the services, the
maintenance services will be offered through Tomorrow Now.
We're not going to prepare an ecosystem of th~rd party
services around that.
The migration services, on the other
hand, can be offered by all of our partnerSr and we share a
lot of partners who served SAP customers that also had
PeopleSoft and JD Edwards.
I think one of the most prominent
ones is IBM, and I think you saw IBM yesterday sharing the
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same view as SAP - that you really need to serve your
customer, first and foremost.
We saw yesterday a statement
from IBM.
We heard the same statement applied to this
offering, and I think you guys should call Mark Elliott and
talk to him about IBM's offering and to into the Safe Passage
program for 2005, together with SAP.
And I think the reality
of life is, we're offering these customers to stay with their
system integrator, and they can choose, just like they chose
to come with us and not be forced down a migration path with
Oracle.
They can choose to stay with their system integrator
and we will offer these system integrators the ability to
offer migration services down the path, down the road.
Also,
we'l~ offer them to extend these implementations that they've
done in the past, with now including NetWeaver and enabling
them to build more composite applications and more
innovations for these customers.
So I think the partners
will get a tremendous benefit wherever they are in the world,
including in Russia, by the way.
It allows them to continue
their business in an uninterrupted way, and not disrupt their
business, not disrupt their customer's business.
MR. BILL WaHL:
I think another point worth maki~g, Carolyn, is
that this offering with Tomorrow Now that we're announcing
today is not the first initiative or first effort we've had
at SAP and reaching out to PeopleSoft and JDE customers.
As
soon as the announcement was made 18 months ago, about the
possibility of an Oracle takeover, Bill McDermott, 'his sales
teams, and SAP sales teams around the world have been
engaging in those customer bases very actively.
This is a
continuation of an IS-month effort, and perhaps Bill, you
might just want to quickly comment on how your sales teams
have been engaging PeopleSoft and JOE customer bases over the
last year and a half.
MR. BILL McDERMOTT:
Sure.
Well, as you know, as Bill rightfully
pointed out, in 2003 we announced the Safe Harbor campaign at
SAP and that brought a lot of PeopleS oft and JDE customers to
the conversation table with SAP, and many of them, ,such as
Medtronic, as an example~ high tech medical device
manufacturer in Minneapolis, chose to go with SAP as their
future, versus being forced into anything from Oracle, based
on this acquisition strategy.
Incidentally, the other piece
that's probably worth noting is, over the last year and a
half, many of our partners have redoubled their focus on SAP,
and of course I'm speaking in North America in this context,
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and moved many of their resources to the SAP practice, but to
the fact that, in the .last 28 months we've captured 22 points
of market share in North America, and are the undisputed,
number one business $oftware company in North American, even
when you do combine Oracle, PeopleSoft, and JDE together.
The data that was purported yesterday is obviously from 2003.
We've stayed current on our applications business, and
actually measure that quarterly.
They seem to be about a
year and a year and a half behind.
So our partner~ now are
interested in the Safe Passage program and will have specific
strategies based on the segment of the market, the various
industries that we serve and, of course, the product
categories.
Product categories meaningmySAP ERP in
particular for this, but there are certain areas, such as
CRM, the customers have exhibited a great deal of interest in
SAP on, as well.
MR. BILL WOHL:
Thank yOU7 Bill, and thank you, Carolyn.
did you have a comment?
Shai,
MR. SHAI AGASSI:
Yeah, I think it's important to note, as the
leader in the enterprise applications market, it is our duty
to our customers and to the market as a whole, to take away
uncertainty.
And I think as the market leader, we stayed
away from the fight.
We didn't comment, we didn't play, we
did not participate in the back-and-forth that happened
between PeopleSoft and Or?cle.
As the leader in the market,
we're taking away the uncertainty by offering a continuous
innovation path for our customers.
They have to focus on
business, while we focus on making sure their investment is
protected and their I.T. landscape is continuously evolving
to meet their needs.
MR. BILL WOHL:
Next question, please?
OPERATOR:
Thank you.
Our next question comes from the line of
Brent Thill, Prudential.
Please go ahead.
MR. BRENT THILL:
Thanks.
Maybe you can comment just on the size
of Tomorrow Now.
There were reports that the company's less
than 50 employees.
I guess that was, like, a broader
question.
If you do get a good hit rate on the migration,
can 50 employees actually help support this effort?
MR.
SHAI AGASSI:
MR. BRENT THILL:
Hi, Brent.
How are you doing.
[Unintelligible] .
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MR. SHAI AGASSI:
I think it's important to look at Tomorrow Now
in--from the perspective of one, how many customers do they
support, which is now at 100, which is already a point of
scale.
Two, what is the leve~ of satisfaction of these
customers, if you actually measured the level of satisfaction
of the customers, it's the service that they're getting right
now.
It is tremendous.
It's almost unparalleled in the
industry.
It's very--it's at the level that we expect to
provide the SAP name"and SAP brand behind it.
We will put a
lot of additional resources into Tomorrow Now.
We're going
to support and scale them up, together we'll demand the
resources.
As you know, are in very, very high availability
right now in this market.
For some reason, we get a lot of
resumes of people who have PeopleSoft and JD Edwards support
experience.
We can't figure out why, but we seem to get an
abundance of these resumes these days.
So as a result of
that, we believe that there is no problem for Tomorrow Now to
scale, there is no problem for Tomorrow Now to meet the same
level of guaranteed service agreement, and we will make sure
that the level of customer acceptance and customer
satisfaction will remain stable as we go through this.
We
believe that if this becomes a very, very high
[unintelligible] rate, as we expect, we believe that this
will create a lot of momentum, and will force, frankly, a lot
more resources to be freed up in the market as a result of
that momentum.
MR. BILL WaHL:
It's probably worth noting too, that the Tomorrow
Now maintenance support is part of the wide offering from SAP
maintenance service and support for the total SAP customer.
So we're not talking about stand-alone businesses being
supported by Tomorrow Now.
These are SAP customers,
supported b~ SAP maintenance.
Tomorrow Now is an adjunct to
that, and it's the total SAP life cycle support that ~omes
with the 17 percent maintenance, ahd that gives us confidence
that we can scale and deliver.
Next question, please?
OPERATOR:
Next question comes from "the line of Ross MacMillan,
Morgan Stanley.
Please go ahead.
MR. ROSS MacMILLAN:
Yeah, I did have one follow-up.
Maybe for
you, Bill.
I just wonder~d what IBM are kind of saying at
the moment with regard to either whether they want to be
involved more closely in supporting the AS400 base with the
JBE customer base.
Or whether they have any initiatives o£
their own, perhaps, you know, provide support for those
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customers and see that as a revenue stream.
I didn't know
whether you commented that or just need to give us an idea of
maybe how your discussions with IBM have kind of progressed
over recent weeks.
Thanks.
MR. BILL McDERMOTT:
Sure, Ross.
Thank you for the question.
IBM
remains an outstanding partner of ours.
And yes, we are
cooperating with them.
Especially with the JOE, AS400
install base, and they are highly active with SAP in this
pursuit of the Safe Passage program for the market.
Furthermore, as you know, they're very interested in
expanding their presence in OB2, so we are very good partners
with~hem, and if you would talk to their senior executives,
I think they're quite excited about this offering.
MR. ROSS MacMILLAN:
MR. BILL WOHL:
OPERATOR:
Thanks.
Next question, please?
Our next question_
MR. BILL WOHL:
You brought--go ahead.
.
OPERATOR:
Our next question comes from the line of Simon Andrews,
Jefferies.
Please go ahead.
MR. SIMON ANDREWS:
All right.
Thank you.
Just wanted to get a
sense of--from you based on the conversations you have with
clients.
How many of those 4,000 mixed-environment customers
you think that you can expect to migrate over to SAP? And
then secondly, just want a clarification.
Do--can the
PeopleSoft SAP customers stay on PeopleSoft indefinitely, or
do they have to commit to upgrade to mySAPat some point?
MR. BILL WOHL:
rhanks for the question.
Shai?
MR. SHAI AGASSI:
Let me take the second half.
I think we're not
going to force them to migrate into the SAP offering, any
different than we offer it to our customers.
So if you know,
for example, SAP has just got into the 25th year of R2.
Just
to give you a perspective how long we support customers.
On
the R3 platform, we had an offering that was called 512, five
years, one year, two years.
It's a standard .engagement for
us that prolongs the life of a supported version, and as long
as the customer wants to go with it, and the same will apply
in this case for the PeopleSoft and JD Edwards offering.
We
are truly grandfathering these customers into the SAP family
and treating them with the respect that they deserve.
With
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regards to the numbers, I think we have so many analysts on
the line right now, and I would love to see some of the
spreadsheets that are going to run that will stimulate what
happens to this market, and I. think I'm going to let you guys
do your job on predicting how many of these customers will
actually make the right choice and go into Safe Passage with
us.
I actually think that for--especially for that group,
for the two customer groups, and the two common scenarios
that we see.
Customers that run SAP in the corporate office
with JD Edwards in some small manufacturing site, and
customers that were on SAP financials and manufacturing with
PeopleSoft Enterprises, the HTML application, for both of
these customer bases, an offering to migrate, consolidate,
and get a better transition into a solid ERP, mySAP ERP
offering, with solid NetWeaver platform, at today's offering,
is unheard of.
And I think that they will make the right
choice.
There is no better choice for them than to use this
opportunity to consolidate to a strategic relationship with
SAP across the board.
MR. BILL WOHL:
And for media on the line, I think Shai's point is
well taken.
There are a number of industry' analysts who have
studied this offer, and I would encourage media to contact
analysts like Yvonne Genovese at Gartner, Barry Wilderman at
Metta, Jim Shepard at AMR, and Josh Greenbaum at EAC.
We
think that they have an active dialogue with PeopleSoft and
JDE customers and can comment directly on the likelihood of
those customers to take advantage of Safe Passage.
Next
question.
OPERATOR:
Next question comes from the line of David Bradshaw,
Ovum.
Please go ahead.
MR. DAVID BRADSHAW:
Thank you.
Please explain to me, gentlemen,
I'm having a little difficulty understanding, why anybody who
has no immediate plans to upgrade or to shift from PeopleSoft
to a JDE with--to SAP, should take up the 17 percent license
package, when they could get i t for either 10 percent from
the same source or they could stick with PeopleSoft/Oracle
and get all the product that create for free.
MR. SHAl AGASSI:
Right, so again, David, I think that you asked a
great question.
I think that it's not why would they do it.
They have two choices.
They have a choice to park their
current application and to maintain them at the 10 percent
with Tomorrow Now.
That's one choice.
They have a choice of
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actually continuing to innovate and bring in a platform like
NetWeaver.
Continue to integrate into their SAP
implementations.
Continue to get applications like Excepts
to run on top of PeopleSoft a~d JD Edwards, and bring in
mySAP ERP at a significantly discounted price.
If they want
to do that, they go down the Safe Passage offering.
Both of
these offerings are actually valid for our customers.
We
believe that there is significantly more value in the Safe
Passage offering than in just parking their applications and
waiting for innovation to corne knock on your door.
I
actually believe that most of these customers should be happy
with this proposition.
I think if I'm a CIa that needs to
explain to my CEO, after 18 months of uncertainty, what am I
going to do.
This is the best offer I can bring back to my
CEO, and since now I know what I'm going to do.
MR. DAVID BRADSHAW:
Forgive me a moment, but wouldn't SAP
customers already have NetWeaver?
MR. SHAI AGASSI:
if they...
If they have R3,
MR. DAVID BRADSHAW:
Yeah.
Yeah.
they don't have NetWeaver.
So
[Unintelligible] mySAP.
MR. SHAI AGASSI:
If they have mySAP ERP, obviously they do, but
again, don't forget, mySAP ERP will give them license to
NetWeaver, only to those users who have mySAP ERP.
So if you
have ERP in corporate, but you have JD Edwards in the small
manufacturing site, you do not have NetWeaver license for
this manufacturing site.
MR. DAVID BRADSHAW:
Okay.
Thank you very much.
MR. BILL WOHL:
Thanks for your question.
We probably have time
for one or two more questions.
Go ahead, operator.
OPERATOR:
Great.
The next question comes from the line of Mairi
Johnson, Goldman Sachs.
Please go ahead.
MS. MAIRI JOHNSON:
Hi.
Thanks very much.
I was wondering if you
could let us know, following on Simon's questions, what is
the average installation size of the PeopleSoft or JD Edwards
customer base that you're targeting.
And relate that perhaps
if you have a sense of what's [unintelligible] to that
installed base has, say, more SAP than the other two,
PeopleSoft and JD Edwards.
MR. BILL WOHL:
I don't think that there's any particular size
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that we're targeting.
It's any SAP customer today that's
running PeopleSoft or JD Edwards, anywhere in thei~
enterprise.
There isn't a component of size.
There's no
typical configuration that way.
Are you talking number of
licenses, size of revenue, size of company?
MS. MAIRI JOHNSON:
Yeah.
So the, you know, the initial license
fee they paid for their installation.
I mean, are these, for
example, the majority of these in your view, predominantly
SAP shops already, with a few bits and pieces of PeopleSoft
and JD Edwards? Or_
MR. SHAl AGASSl:
MS. MAIRl JOHNSON:
Yeah,
I think_
Or...
MR. SHAI AGASSI:
Sorry.
I think that, if you look at these two
scenarios that we've outlined, these are scenarios that are
pretty much agreed upon with the industry analysts as well.
The two common scenarios that you'll see is SAP and
corporate, JD Edwards and manufacturing site,. or SAP as
financials and manufacturing, PeopleSoft HTML, HR
applications.
These are the most common sc~narios that
you'll see, especially in the North American theater.
When
you look at that kind of a situation, and you ask yourself
what is mare strategic.
Is the corporate headquarter main
system, ERP system, more strategic than the small
manufacturing site? I think that, by and large, the answer
in 90 percent, 95 percent of the cases, will be yeah, the
main system in corporate is SAP.
If you look at what is more
strategic, if I need to alrea4y walk away from my HR
application, should I consolidate into Oracle? Or should I
consolidate into SAP.
I think that if your financial
systems, your manufacturing systems are already on SAP or
(unintelligible], your distribution systems are already on
SAP.
The tendency, by and large, will be to consolidate into
your SAP system, not into some imaginary application that has
not yet been created.
So if you look at these two scenarios
that probably describe 90, 80, ~O percent of the cases,
that's the situation you're looking at.
And I think, in both
cases, it could be a significantly more strat~gic, and the
long term decision that the customers have made.
MR. BILL WOHL:
And to your question on sizing, if you look at the
customer list on the Tomorrow Now website, you're going to
find enterprises that are large, mid-size, and small--public
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sector and private sector, across multiple industries.
we have time for one more question, operator.
And
OPERATOR: Okay.
We'll see if--any other questions, please
depress star, zero at this time.
MR. BILL WOHL:
And in fact, if there are none more in the queue,
then I will take this opportunity to thank everyone for
participating today.
Journalists may contact SAP at our
press offices in Waldorf and Newtown Square if they have
additional follow-up questions.
Contact information can be
found at SAP. corn/press. On behalf of Bill McDermott in
Washington and Shai Agassi here in Waldorf, this is Bill Wohl
wishing you a good day from SAP.
OPERATOR: Thank you.
Ladies and gentlemen, that does conclude
our conference today.
Thank you for your participating, and
for using AT&T Executive Teleconference.
You may now
disconnect.
FEMALE VOICE 1:
Thank you for call...
[END TRANSCRIPT]
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