Why SAP strategically enters the business network space

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Sep. 25 2014, Updated 9:00 a.m. ET

SAP ventures into the business network space

SAP (SAP) is known for its business management software. For the past few years, SAP has been acquiring subscription-based software for cloud vendors. According to 451 Research, SAP’s acquisition of Concur Technologies is the fifth largest transaction in the overall software market. Its acquired Ariba and Fieldglass earlier. These acquisitions, combined with its latest acquisition of Concur Technologies, are expected to place SAP in an enviable position in business network space.

An increase in customer base along with entry into the business network space

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SAP mentioned that the Concur acquisition would allow the company to increase its cloud customer base to 50 million. Currently, its base is 38 million. Concur Technologies has 4,200 employees, 23,000 clients, and more than 25 million users in 150 countries. Clients rely on the business expense and travel management software and services. SAP claims that the Concur acquisition will make it the second largest cloud company—based on revenue. Google (GOOGL) is a leading player in the business network space.

SAP HANA
Concur’s travel and expense solutions 

SAP reported that only 30% of Concur’s customers use SAP. This indicates a huge opportunity to scale its innovations on the Concur platform. SAP estimates that the corporate travel market is worth $1.2 trillion. By acquiring Concur, SAP wants to grow its business network to reach the high growth market.

SAP HANA can be deployed on third party providers like Amazon web services (or AWS)—as shown in the chart above. SAP combines the presentation of smartphones and other computing devices with the power of smart data crunching apps on HANA. They can be enriched with out-of-the-box analytics tool sets like SAP Lumira with HANA One on AWS.

To learn more about SAP HANA, please click here.

SAP’s business network is way ahead of Amazon, eBay, and Alibaba

According to SAP’s CEO, Bill McDermott, acquiring Concur enhanced SAP’s business network. The network can handle more than $600 billion annually—50% more than Amazon (AMZN), eBay (EBAY), and Alibaba (BABA) combined.

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