Thursday, December 11, 2003

Clash of the titans

CNET has a long article on the behind the scenes battle between SAP and Microsoft in the enterprise systems marketplace. The article highlights a $10 million win by Microsoft over SAP at Esselte, a $1.1B office supplies manufacturer. The win is the largest in the short history of Microsoft Business Solutions. While Microsoft is increasingly reaching up into such larger deals, SAP is reaching down with its SAP Business One offering to small businesses, Microsoft's home turf.

The article also highlights what I think is a more significant battle: the fight over for resellers. Resellers are the key to success in the small business ERP market, and SAP, it seems, has been courting a number of Microsoft business partners. SAP, which relies mostly on a direct sales channel, does not have anything close to the reseller channel that Microsoft picked up through its acquisitions of Great Plains and Navision. If SAP were to win over some of those resellers, it wouldn't have the big splash of Microsoft's win at Esselte, but the impact ultimately would be greater.

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