SAP bowed to the inevitable today, saying it would wind down operations at its TomorrowNow subsidiary that provides third-party maintenance for Oracle’s full-house of enterprise applications.
The TomorrowNow acquisition looked too clever by half even when SAP announced the deal back in 2005. TomorrowNow was a novel, fledgling business that had attracted attention because it undertook to support applications from PeopleSoft, JD Edwards and later Siebel – all of which ended up as Oracle properties – as an alternative to the support offered by the vendors themselves. The theory was that companies would look for superior value rather than dutifully paying the extortionate “maintenance taxes” that have long been the complaint of enterprise IT folks.
SAP buying TomorrowNow seemed more like the Germans tweaking Larry Ellison’s nose than anything resembling a strategy. Neither can enterprise IT buyers have been overly impressed by the petty squabbling that went on between the two major ERP firms and their promises of discounts and safe havens for firms willing to forsake one supplier for the other. TomorrowNow never made much money and then it ran into scandal in a nasty little case over staff wrongfully downloading Oracle materials.
SAP tried to sell off TomorrowNow but doesn’t seem to have had any joy in finding a buyer. Now it is giving in, saying it will “assist our customers in transitioning to a new support provider, including Oracle”.
The shame for SAP is that the TomorrowNow episode lost it a little of its hard-won image for sober business deal making. Certainly it became a well known fact that if you wanted to embarrass SAP executives all you had to do was mention TomorrowNow.
With the TomorrowNow disposal, SAP sweeps an inglorious episode under the table.