SAP and Intel have launched Pandesic, a jointly owned company that aims to provide small and medium-sized businesses with Internet commerce solutions.
In a bold move by the giants to tie a burgeoning market to their technologies, the company aims to offer its products outside the US within 12 months and sources said Germany and the UK will be next.
At the launch in San Francisco this week, the companies claimed Pandesic offers more than online Internet transactions - its product also includes all the order, inventory, tax, logistics and financial processes currently conducted on paper.
Analysts said Pandesic?s solution could appeal to businesses wanting to trade online but warned that many may not want to be restricted to the Intel architecture or the proprietary SAP software.
Intel and SAP refused to reveal how much they have spent on funding Pandesic, which will be headed up by chairman Harold Hughes, the former chief financial officer of Intel. Bryan Plug has moved from his position as SAP America executive vice president to become Pandesic president and chief executive.
SAP America CEO Paul Wahl said Intel provides Pandesic?s logistics and SAP its business software. SAP's interest in the venture is clear - it wants to expand the market for its R/3 applications suite to online systems. But Intel?s reasons are less obvious.
Craig Barrett, Intel president and chief operating officer, claimed the company wants to see more Intel-based Internet servers in the market, and the uptake of Internet commerce will help achieve this. Hughes added that plans are ready to include an 'Intel Inside' branding concept in the solution.
Hughes said companies in many sectors are anxious that they will be usurped by online competitors, in the same way that online bookstore Amazon.com has revolutionised book sales. "With us, a Swedish furniture company could sell to online customers in the US without having a US office or worrying about the tax, shipping and financial issues." Plug said: "We can deliver Internet business to merchants of any size within weeks."
The solution will be sold for business-to-business and business-to-consumer applications, initially through resellers Inacom and US Web. Pandesic is recruiting channel partners but Plug admitted only Pandesic has the expertise to fully support the product, leaving a question mark over its future channel sales policy, especially in Europe.
The Pandesic Web commerce solution is based on code from SAP?s R/3.1 Internet-enabled package but Wahl promised it will work with competitors? financial and accounting software, using interfaces. He denied it was a version of R/3 Lite tailored for a particular need.
Pricing will be finalised within seven weeks but Plug said customers? set-up cost will be "in the low double digit thousands of dollars". The profit for Pandesic will come from a commission on transactions of between one and six per cent, dependent on volume and similar to the charges credit card companies levy on businesses. Hughes said Pandesic will eventually offer Secure Electronic Transaction (SET) certification.
The solution includes an Intel-based server pre-loaded with the transaction, payment processing and banking software. Hewlett-Packard and Compaq have initially signed to provide servers, which also carry Microsoft NT Server, SQL Server and Internet Explorer. Other Pandesic partners are involved, including Citibank to provide banking services and Cybercash providing secure transaction tools. Also, Taxware supplied international tax accounting tools, UPS is the preferred delivery and tracking company and Yahoo will be providing ads and promotions for Pandesic.
Pandesic claimed it improves on solutions from competitors such as Open Market because it offers a more complete, efficient product.
Based in Sunnyvale, California, Pandesic has started business with 50 staff taken equally from SAP and Intel.
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