SITA and SAP team on ASP venture

SAP is teaming with SITA, a technology integrator for the air transport industry, to offer small and medium sized enterprises (SMEs) in the sector the opportunity to take mySAP.com on a rental basis.

The system will run over SITA's secure global voice and data network and use SAP hosting to deliver the maintenance, engineering, procurement, finance and human resources applications. The new venture is yet to be named.

SAP has over 400 customers in the aerospace and defence industries, while SITA provides a range of application services to airports, airfreight operators and aerospace companies that are integrated with its desktop and network infrastructure solutions.

SITA spokesman Karl Moore said that the organisation already offers its passenger management applications, such as departure control, cargo and freight management, on an application service provider (ASP) model whereby SITA covers the cost of development and implementation and customers pay a service fee to run and use the applications. These, however, will not be available through the new ASP venture, he said.

Moore added that setting up an ASP operation using mySAP.com will now enable SITA to offer its customers "real management, business class applications".

SITA is currently working with a few early adopters, the identities of which cannot be disclosed, and plans to be operational in the first quarter of 2001. The venture is targeting small and medium sized airlines; maintenance, repair and overhaul providers; original equipment manufacturers; and airports.

However, Rakesh Kumar, programme director of enterprise data centre strategies at Meta Group, which tracks mySAP.com, said: "There is no such thing as an SME in the airline industry. If they were offering the SITA applications it would be sensible, but if they are only offering generic human resources, what's the point?"

Niche, industry-specific ASPs are likely to fare better than those offering generic applications, many of which will find themselves in trouble, he added.

In general, Kumar believes that ASPs have still not properly evaluated pricing policies that will generate a profit, yet attract custom. He is not convinced that SITA or SAP are any wiser.