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SAP moves to take the middle ground

SAP is focusing more heavily on the middle market, the firm said last week, promising to invest as much as US$518million on product development this year.

The German software giant will introduce a new product set targeted at the mid-market this year, including a complete application suite known as AIS, while it will also focus on offering more software-as-a-service (SaaS) solutions.

SAP has been changing the way it deals with customers, putting more emphasis on subscription sales models, rather than its traditional licence model.

"2007 will be the year in which we successfully complete our roadmap by delivering services-enabled versions of the mySAP Business Suite and our established mid-market solution SAP All-in-One," CEO Henning Kagermann said last week, in a statement announcing the firm's fiscal results.

"Also in 2007, we will begin delivering on what we believe is the most innovative solution in the industry designed specifically for new segments in the mid-market," Kagermann added.

SAP's shares dropped nearly 5% last week after it announced its fiscal 2006 results. The software vendor reported revenues of US$12.1 billion for the year, up 11% on 2005.

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