While watching the recording of last week’s press conference for the launch of SAP HANA for ERP, I noticed something that already struck me a number of times before.

At 18 minutes into Hasso Plattner’s introduction, a presentation slide comes up titled “Where We Are Today”.

It reads:

“Thanks to the power of SQL, only one version of Suite will go forward using not only HANA but DB2, Oracle, MS-SQL, SAP-ASE as well.”

That’s all good, but what struck me here is “SAP-ASE” being mentioned last. This must be about “Sybase ASE” – I’ve seen it named “SAP Sybase ASE” elsewhere – but why is it mentioned after Oracle and Microsoft?

After all, SAP spent 5.8 billion to acquire Sybase in 2010. After the initial press coverage it got very quiet around Sybase. And that’s odd: Sybase was supposed to be a strategic and database-centric acquisition for SAP. Yet SAP never seems to bother even mentioning Sybase.

A case in point is Hasso first mentioning Oracle, DB2 and MSSQL with ASE trailing at the end: it doesn’t sound like he cares much about the Sybase databases. If Hasso or SAP did care you’d expect to see ASE always mentioned first. Okay, let it come second after HANA, but definitely the pecking order should be that all non-SAP databases only get into the picture after HANA and Sybase ASE.

It was not the first time this made me wonder. When was the last time you heard Sybase being promoted at a big SAP event?

So what has happened to Sybase? Their products had a good reputation, with Sybase ASE strong at Wall Street. Sybase had probably disappeared off most IT people’s radar but with SAP blowing wind in Sybase’s sails, great things could have happened. Sybase still has thousands of paying customers and SAP sure wants to keep them happy. Staying mum about Sybase will not achieve that.

I occasionally tried to discuss the Sybase issue at the big SAP events, but finding folks with opinions ain’t easy. Most agree Sybase is invisible. Consensus on the reasons there is not:

  • Buying Sybase was a mistake since SAP is exclusively about HANA.

This one I got at the HANA booth at Sapphire (perhaps not surprisingly). The Sybase databases will be closed down and the developers reassigned to HANA or leave. This is not impossible but then there comes a point where SAP must write down those acquisition billions and I guess they’d rather avoid that (HP/Autonomy, anyone?). SAP may have gotten some technology from Sybase but if that really played a role in HANA you’d expect SAP to give that fact much more exposure, if only justify the acquisition.

  • SAP only took the Sybase mobile software but never knew what to do with Sybase databases which they just forgot about and now they’re quietly circling the drain.

The rationale behind acquisitions is often more boneheaded than you’d think so this is a definite possibility. But also here a huge write down would be looming which makes this theory unlikely.

  • SAP just needed fresh new customers to sell SAP applications to.

At least that’s how Bill McDermott’s quote can be understood: “With this transaction, SAP will dramatically expand its addressable market by making available its market-leading solutions to hundreds of millions of mobile users, combining the world’s best business software with the world’s most powerful mobile infrastructure platform”. This actually makes sense because as we all know the ERP market has become saturated and is more of a replacement market now. But also here you’d expect more rumble about Sybase if SAP wants to approach those customers.

  • Sybase was destined to be SAP’s flagship database.

According to SAP at the time of the acquisition, “Sybase’s core database business will be enhanced by SAP in-memory technology to deliver integrated transactional and analytical capabilities, according to SAP.” This sounds like putting the HANA concept inside Sybase. When you think of it, that actually makes a lot of sense: take some startup ideas and put them in a well-established proven product.

But there must have been a change of plan because HANA took the #1 spot. Maybe the Sybase technology was not as good as it seemed but SAP only found out after the deal?

  • SAP has a plan to use Sybase technology as part of HANA but does not want to give it exposure.

I would have believed this two years ago but if they still have not figured it out by now, it ain’t gonna happen. Business Objects got much better visibility in comparison.

  • Sybase is SAP’s secret weapon: while HANA is sold at premium price, Sybase will be deeply discounted to undercut Oracle, Microsoft and IBM for everyone who does not buy HANA.

Such a two-pronged strategy would make a lot of sense, especially because HANA seems very expensive for ERP (remember, you need to buy special hardware for HANA too). But SAP’s corporate silence around Sybase doesn’t add up. Even a great secret weapon does not sell itself. And from what I understand the pricing for Sybase is exactly the same as for Microsoft and IBM. So whatever the plan is, it’s not this one.

In short I just don’t see how the Sybase acquisition makes economic sense to SAP unless Sybase databases are either aggressively marketed/sold or the Sybase technology somehow gets a prominent place in HANA. In either case SAP would need to give it exposure or Sybase effectively dies as the silence erases it from memory. And that would make the acquisition a failure.

If SAP is forced to write down the Sybase acquisition that would be a public embarassment for SAP and surely it will not be appreciated by investors. It also calls into question SAP’s technology vision.

So if I had the opportunity to ask Hasso a question, it would be this: you have stated repeatedly HANA is the future, but how does Sybase fit into this? Please enlighten us.

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  1. Timo ELLIOTT

    I think the answer is much simpler: marketing focus. SAP ASE is a great database and a very smart business decision, but SAP HANA is the “game-changer” (sorry about the kittens). 

    As Hasso said in his presentation, Sybase’s deep knowledge of database technology was a key part of the acquisition decision.

    The Sybase roadmap and how it relates to HANA has indeed been communicated, but mainly directly to the accounts that might be interested.

    The blog post “The Path Forward”, by Irfan Khan, the Sybase CTO, talks about the the roadmap for the full “Real-Time Database Platform,” which includes HANA, Sybase ASE, IQ, ESP, Replication, links to “big data” etc.: http://www.saphana.com/community/blogs/blog/2012/12/05/the-path-forward–the-sap-real-time-data-platform-powered-by-sap-hana

    And this article from InfoWeek is also maybe relevant: SAP Sweetens HANA Deal with Free Sybase Database: http://www.informationweek.com/software/enterprise-applications/sap-sweetens-hana-deal-with-free-sybase/240146282

    1. C.J. Thomas Post author

      My point is that something for which 5.8 billion was paid should be expected to get some recognition at the level of Hasso, but this it does not. Sure ASE pops up here and there now but that looks out of proportion with the price tag. And when you ask 10 SAP customers, they will all know about HANA but you’re lucky if one of them knows what Sybase is.

      Bottom line, I’m not seeing how SAP can justify the Sybase acquisition given what they have done with it.

      1. Timo ELLIOTT

        Remember, though, that it’s not only about what Sybase databases can bring to SAP customers. For example, the Sybase customer base includes a large, strategic part of the finance sector which cares deeply about both fast transactions and real-time analytics…

        1. C.J. Thomas Post author

          True. And in fact, for those pre-SAP Sybase users it will not be reassuring to hear so little about Sybase. It would be difficult for them to conclude that Sybase is really important for SAP: if it were then Sybase would get more airtime. Also see the last line of Stephen Johannes’ reply below.

  2. Tobias Hofmann

    Since when did SAP buy Sybase solely because of their DB product? I doubt that the DB knowledge SAP gained is of no value at all to HANA. While HANA gets more marketing, ASE is used by SAP and was well presented at SAP TechEd Las Vegas.

    SAP know has a mobile platform they effectively did not have before.

    1. C.J. Thomas Post author

      When SAP acquired Syclo last year that did not exactly radiate confidence about the Sybase mobile platform.  As far as I understood the mobile platform was only a small part of Sybase.

      1. Tobias Hofmann

        SUP may not have been the biggest and most widely known platform from Sybase, but it was one of the reasons why SAP bought Sybase. Very fast SUP was transformed into a SAP product, actively marketed, sold and incorporated into SAP’s roadmap. The name SUP won’t survive the next years (rebranding into SAP Mobile Platform), but SUP plays a very important part in SAP’s mobile strategy and reaching 1 billion users.

        The plans and roadmap about Syclo and SUP show that Syclo will be integrated into SUP, leveraging the capabilities of the Sybase platform. SAP made it clear that they bought Syclo because of the apps.

        We don’t know the revenue, license etc numbers, but I’ll be surprised if SUP isn’t giving SAP some good license deals and brought new (mobile) customers that before used another 3rd party mobile solution.

        SAP buys companies differently compared to others: mostly because of the (process / industry) knowledge, not because of the code. Was it worth the money? That’s the wrong place to ask, as we won’t (probably) never know the deal and expectations in all its details. But definitely the DB was only one reason.

  3. Stephen Johannes

    IMHO the sybase acquistion was never about anything more than acquiring a valid mobility solution offering to sell to existing SAP customers and allow SAP to attract new customers.  All the other “cool things” that sybase did besides SUP, were bonus parts of the deal.  You also need to remember SAP has a long historical pattern with acquistions of borrowing concepts from the old tool and then rewriting it in an SAP fashion.  Some examples were SRM, Enterprise Portal and the java application server.  The top-tier versions of the portal technically were a far cry from the SAP versions of the same product.  Even the SAP branded 5.0 to 6.0 was completely different animal in many respects.  I think the Business Objects products escaped this, but only time will tell.

    I do think the database knowledge/talent from Sybase has been effectively blended into SAP HANA along with other knowledge from things like SAP DB and TREX.  I wouldn’t necessarily say SAP needs to write off the entire acquisition, but if I were a “traditional customer” of sybase solutions that weren’t mobility, I would share your concerns based on the past historical behavior of SAP.

    Take care,


  4. Tom Van Doorslaer

    Hi C.J.

    I see following key advantages to the Sybase acquisition:

    • Sybase Unwired Platform
    • customer base
    • Database knowledge (I bet that a lot of the knowledge from Sybase helped refining HANA, and I wouldn’t be surprised if there were some patents that played a part. )
    • You can’t keep everything in memory, forever. At some point, it needs to be archived on a disk: –> Sybase ASE, Sybase IQ
    • Not all customers will move to HANA. With ASE and IQ, they get two nice alternatives to Oracle.

    That ASE was mentioned last, after Oracle and MS may very well be a marketing trick. Both the first and the last are SAP products. If you give people a list of 10 products, they’re inclined to only remember the first and/or the last. everything in the middle is forgotten.

    Still, you may be right that they overpaid for Sybase, but imagine that Oracle had bought Sybase…

    The real reasons for the acquisition are safely locked away in the boardroom. We can only guess.

  5. Rob Verschoor

    I think you are reading too much into the perceived absence of Sybase in the SAP corporate messaging and the fact that Hasso mentions Sybase last. Although I don’t know the considerations of those who made the decision, I think Sybase was acquired for a combination of reasons, some of which you in fact mention in your post. IMO (but I’m coming from Sybase myself) the main reason was Sybase’s database technology with more than 25 years of battle-proven experience. With that sort of knowledge, there are many ways in which Sybase contributes to the success of HANA and of SAP’s database business in general, and much of this is behind the scenes for good reason.

    However, I do not think that it is justified to conclude that just because SAP isn’t

    making “Sybase” the core of its database message, the acquisition has failed. SAP has chosen HANA technology as its innovation platform and given the momentum that will always be the #1 message you will hear from SAP. That said, SAP is a big company and there are many other products besides HANA, and since they cannot all be promoted at the same time, a single main headliner must be chosen, which is HANA.

    Check out the following SAP Statements of Direction which clearly spell out the position of Sybase databases going forward:

    http://www.saphana.com/docs/DOC-2851: ASE Position for Sybase customers SoD

    http://www.saphana.com/docs/DOC-2852: ASE+SRS for SAP customers SoD

    http://www.saphana.com/docs/DOC-2853: ASE + HANA interoperability SoD

    http://www.saphana.com/docs/DOC-2854: IQ+HANA SoD

    http://www.saphana.com/docs/DOC-2855: RTDP SoD

    As other commenters have pointed out, ASE is bundled with HANA for Business Suite. And while I cannot give any numbers, SAP has been very successful in selling ASE for Businss Suite in 2012.

    On your suggestion that “the Sybase technology was not as good as it seemed” — this is just nonsense and speculation.

    Also keep in mind that by their very nature, Business Objects and SUP (Sybase/Sap’s mobility platform) will always be more visible than a database since these products are for applications that users interact with directly. Yet a database runs in the background and if it does its job well, you should never notice it is there. It is not unlogical that this is reflected in the amount of publicity, especially for an applications-oriented company as SAP.

    Lastly, Hasso has, in fact, publicly ackowledged Sybase as a great acquisition: check out this video: http://www.sap-tv.com/video/#/8379 . They are discussing SAP’s acquisitions and at 2:10 Hasso says that when Bill McDermott asked Hasso for the 3 names of companies he was interested to acquire, Hasso says “the number one name was Sybase” and as reason he gives that Sybase was the #4 database company and SAP was going into databases itself. He also calls Sybase “a great acquisition”.

    Since HANA is a highly competitive product, you cannot really blame Hasso for not explaining into detail how the various technology components fit together.

  6. al bundy

    I came to read this article because Sybase, this is the first time I have heard about a HANA database or software by SAP, that’s how the good marketing is. It is a shame how Sybase database was destroyed, it was a very fine software but now is dead, regardless the current or still existing customer base there are only 2 players now, Oracle and SQL Server, whatever HANA is, sounds bad and doesn’t sound like a database.


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