Of SAP, Sybase, the Mets and the Yankees

In SAP's acquisition of Sybase, conventional wisdom seems to lean towards Sybase mobile capabilities as the driving factor, but I'm leaning in a slightly different (and more old-fashioned) direction that goes to the very core of SAP's existence.

No doubt, Sybase has held up well in the onslaught of competition by the likes of Oracle and IBM. It has survived these two behemoths even while going head-to-head against them in their collective core competency -- databases. And that's no mean feat. Sybase is best known for the Adaptive Server, a strong evolution of the erstwhile Sybase database. Sybase has kept pace or led with developments in core database management system (DBMS) features such as encryption and replication. Sybase IQ is a respected name in column-store databases. And Sybase is admired for its mobility support, with solutions such as SQL Anywhere (for dbms-on-the-go) and the more focused iAnywhere Mobile Office (for email and mobile apps). And let's not forget value-added tidbits like Sybase PowerDesigner, and even perhaps the curiously-outmoded-yet-surviving PowerBuilder.Arguably the sweet spot in SAP's acquisition of Sybase is their combined positioning in real-time data warehousing/business intelligence (e.g. complex event processing, CEP) and mobile solutions.

Yet, in my opinion it is Sybase's sorely tried and strongly proven core database technology that will give SAP the greatest advantage. SAP's primary competitor is Oracle, and the parallelism in their growth paths is no coincidence. As the two ruling ERP vendors out there, when one acquires BI capabilities, the other has no option but to follow suit. When one sharpens an edge in middleware, the other has to scramble to dull it. But when it came to the technology stack below the middleware layer, Oracle had a huge advantage in the flagship Oracle database, extended further south with the Sun acquisition.

In the meanwhile, SAP had to remain content with balancing its implementations between Oracle and Microsoft SQL Server databases -- the latter always the far more reliable option, on account of the largely non-overlapping spheres of influence of the two companies. And Oracle has been very smart and aggressive (so what's new?) in leveraging the databases and enterprise apps to push for market share in both spaces. In the Subway Series of enterprise apps, Oracle was beginning to take over the New York Yankees mantle, while SAP was slowly but surely being relegated to the role of the essentially talented but habitually hapless New York Mets.

Now, in one fell swoop, SAP is back into the reckoning once again. Sybase database technology gives SAP the leveler it needs: SAP's enterprise apps no longer need to rest on a platform made and managed by somebody else. The House that SAP Built need not stand on somebody else's property. And yes, Sybase real-time and mobile technologies will allow SAP to leap-frog Oracle in the exploding world of mobile computing. It's like the Mets suddenly woke up from stupor, and acquired a storied minor-league team with shining future stars, led by a stalwart of the sport. SAP was always headed into the World Series of enterprise applications, but now they might not be the underdogs anymore.

Meanwhile, what about IBM and Microsoft? Well, Microsoft has seemed curiously content at remaining a peripheral player in enterprise solutions. Although Forrester ranks it third in enterprise applications (behind SAP and Oracle), it seems unable to corral its forces to launch any form of sustained attack at the high end of the enterprise market. IBM, though, is a different story…and must be chafing at the bits. For one, the IBM acquisition of Informix was always a bit confusing: Where exactly did it end up anyway? What sustained advantage did IBM obtain from the acquisition? And -- more importantly -- did IBM miss the target; should it have gone for Sybase instead? Nothing hurts like a lost opportunity -- except when the competitor profits from it. Given IBM's aspirations to be the biggest in everything, the only wonder is that they have been so silent -- insipid, even -- in the enterprise applications space. The only question that remains is, how much longer before IBM acquires an Infor or Lawson?In SAP's acquisition of Sybase, conventional wisdom seems to lean towards Sybase mobile capabilities as the driving factor, but I'm leaning in a slightly different (and more old-fashioned) direction that goes to the very core of SAP's existence.