Plattner: On-demand ERP delay has silver lining

Although SAP has slowed down the rollout of its on-demand ERP offering Business ByDesign, that decision has given the company more time to implement its in-memory database technology into the software, said SAP’s co-founder Hasso Plattner during a keynote address Wednesday at SAP’s Sapphire conference in Orlando.

“I believe so vehemently in the future of in-memory databases — like Steve Jobs believes in the iPod,” he said. In-memory databases boost performance because storing data in memory allows it to be accessed much faster than from a disk.

[ See related story on SAP’s SaaS strategy: “SAP exec: No plans for additional on-demand ERP.” ]

Business ByDesign is using a hybrid model to handle data, with both a relational database component and the in-memory database, which is now about 90 percent implemented into the hosted offering, Plattner said. The technology is capable of retrieving 1 billion pieces of data in less than a second, he claimed.

In addition, SAP’s in-memory database has significant compression capabilities, he added. “For a 20GB relational database, we probably need only a 1GB [in-memory] database.”

However, the practice of multitenant software as a service — which sees a single instance of software serving a number of customers, purportedly driving down costs — does not mesh well with in-memory databases, according to Plattner. If you put multiple companies in one in-memory database, the performance goes down, he said.

“[Other companies] say, ‘We do multitenant. They say it’s cheap. Yeah, it’s cheap — like cheap housing in the Bronx,” he said. “What we can do with that in-memory database is unbelievable. This is better than to go with the cheapest possible disk device and spread the data over it.”

As for Business ByDesign, the company had initially planned to reach $1 billion in revenue and 10,000 customers for Business ByDesign by 2010, but said last week it will take 12 to 18 months longer to attain those goals. Plattner’s comments represent a new angle in SAP’s messaging around the slowdown, as other executives have said the decision was made to ensure the company can turn enough of a profit on the offering.