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SAP AND INTEL FORM E-COMMERCE JOINT VENTURE, PANDESIC

SAP America Inc and Intel Corp have created Pandesic LLC, a 50-person joint-venture limited liability company set to attack the emerging electronic commerce market (CI No 3217). Pandesic will bundle software components derived from SAP’s R/3 business software, Intel hardware (specifically Hewlett-Packard Co NetServer and Compaq Computer Corp ProLiant servers), Microsoft NT Server 4.0, its SQL Server database, Internet Information Server and Active Page Server software products, plus support from various partners including internet consulting firm USWeb Corp and systems integrator Inacom Corp to offer an integrated product set addressing the logistical, financial, shipping and general ledge aspects – rather than the front-end web page access point – of both consumer and business to business e-commerce. The idea is to ‘productize’ the ability to do e-business, say both parent companies. Pandesic, to be headquartered in Sunnyvale, California, is to be staffed initially with employees of both organizations. No financial terms for the extent of the investment from either firm was made available. Intel vice president and director of planning and logistics, and also formerly (1991) chief financial officer, Harold Hughes, becomes chairman of the new venture, while executive vice president of SAP America, Bryan Plug, formerly (1992) president of SAP’s Canadian subsidiary, assumes the position of its chief executive officer and president. Though SAP and Intel executives, including SAP CEO Paul Wahl and Intel president and chief operating officer Craig Barrett, speaking at the company’s formal launch in San Francisco Tuesday, made much of the two companies’ experience and credibility as international suppliers to the Global 2000, Pandesic will operate solely in the US for at least ba year. Partners apart from USWeb and Inacom include Citibank (offering global banking services), Compaq and HP on the hardware front, CyberCash, Inc (for secure credit card transactions), Taxware International Inc (for eventual in-built worldwide tax reckoning), Telxon (hand-held PCs for warehouse scanning and data capture), Yahoo! Inc (the principal advertising, promotional and consumer navigation arm for Pandesic), and currently strikebound United Parcel Service (as the main delivery option for goods bought and sold through Pandesic). SAP stresses that Pandesic is neither R/3 or R/3 Lite but a ‘collection of more than 55 best business processes honed from the business experience’ the Walldorf giant has gained from its 10,000 R/3 installations worldwide. Intel says it’s doing all this to find more ‘uses and users’ for the Intel architecture. The offering is claimed to be the industry’s first real time ‘order to cash’ system, with features such as secure electronic and credit card transactions, low start up costs (merchants will only pay a ‘small’ percentage of the transaction price for each transaction performed, rather than an outright buy of the entire hardware and software solution), automated real time access to order status, inventory levels, balance sheet data as well as related financial transactions and processes. The first release of Pandesic Internet – aimed initially solely at ‘virtual retailers,’ eventually to more standard business-to-business concerns – is set for the end of the current (third) quarter. The whole set up begs the question of what SAP customers should do regarding both the R/3 version 3.1 internet enabled version of its integrated business software system and SAP software on non-Intel platforms (e.g. Unix). Wahl, who noted that some 40% of SAP business is now conducted on Intel, rather predictably suggested there was no conflict and those lines of business will continue as before – which makes sense if Pandesic sticks to the small internet mall type merchant, rather than the larger organizations who typically buy the product. More at http://www.pandesic.com.

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CBR Staff Writer

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