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The Sky Is Not The Limit

Feb 12, 2013, 22:05 IST

*n3wjack's world in pixels at www.flickr.com

If you take a good look at Amazon’s logo, you’ll realize there’s more to see than simply an arrow-shaped smile. The arrow actually points from A to Z to reflect the breadth of Amazon’s product offerings.

File “cloud computing” under “C.”

Amazon, like many companies with roots that run very deep in enterprise, is making huge strides in cloud-based computing. But there is perhaps no other vendor that better demonstrates this than SAP.

A market-leading vendor in the enterprise application software space, SAP is looking to shore up any gaps in the cloud it has and one-up arch-competitors like Oracle in the process.

“We don’t have the DNA in the cloud,” says SAP co-CEO Bill McDermott in an interview with Bloomberg.com. “We’re probably the most strategic cloud player in the enterprise software industry.”

And some choice acquisitions made it possible.

Purchases of SuccessFactors in 2011 (whose offices are pretty awesome) and Ariba in 2012 helped SAP gain ground over key industry rivals. In SuccessFactors, SAP acquired the leading provider of cloud-based business execution software (and a whopping 15 million cloud users). With Ariba, the company hit the proverbial business commerce application jackpot.

And for a combined cost of $7.7 billion, it was a steal. SAP bought not only the technology, but also the cloud skills and expertise necessary to innovate and become a major player in the space.

As such, SAP broke its growth record in 2011. It went on to break that record again a year later. To put some shine on 12 consecutive quarters of double-digit growth in software and related revenue, the company also reported a hefty 20% increase (to about $6.7 billion) in revenue from software and cloud subscriptions.

“2012 was an outstanding year where we set many new records,” said SAP co-CEOs Bill McDermott and Jim Hagemann Snabe. “We continued our double-digit growth momentum and exceeded our revenue guidance. We achieved a breakthrough in the cloud, and today SAP is the second largest cloud player in the world.”

You might say that this is one instance in which having your “head in the cloud” is a good thing.

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