April 23, 2001, 11:27 AM — SAP AG plans to focus its software business on building and servicing private online exchanges. Two divisions of the company, SAPMarkets Inc. and the newly launched SAP Portals Inc. will be integral to the development of the private online exchanges which SAP believes will link companies to customers and providers more quickly and securely than online virtual marketplaces, the company said in a statement.
The details of the strategy were outlined Monday by Hasso Plattner, co-chairman of the executive board, chief executive officer and co-founder of SAP, in a keynote speech on the opening day of the company's Sapphire 2001 convention in Lisbon.
Open business-to-business exchanges have been proving less successful than anticipated, with Dell Computer Corp.'s sudden shutdown of its virtual marketplace last February after only four months, and the Asian version of SAP's own electronic marketplace MySAP.com, run with Australian telecommunications operator Telstra Corp. Ltd., reporting last March that it had failed to attract any New Zealand customers or suppliers.
SAP is banking on the fact that in creating private online exchanges that are owned, operated and managed by a single company, it is removing the barrier to making online marketplaces profitable, the company said.