 Anyone we can find that has knowledge to share, we'll extract that signal from the noise and share that with you. I'm John Furrier, the founder of SiliconANGLE.com, SiliconANGLE.tv, and we're in Orlando, Florida where this is day three of SAP Sapphire now, 2012, where SAP powering business. Really the consumerization of IT, the consumerization of business is really the heart of the conversation. As you know, from SiliconANGLE.com's corollatorial, we've been doing cloud mobile and social for three years and proud of it, and nothing more exciting than to be at SAP fire and talk about the convergence of cloud mobile and data or social and all that good stuff. I'm going to talk about mobile with my guest, Chris Hazelton, Chris, welcome to the queue. Thank you. You're with 451, an analyst firm, you're on the ground, you're out there getting the signal and noise separated for yourself, you got to report that to your customers and your subscribers and your user base. So you get pitched a lot of SAP rhetoric, they're feeding you the plate of PR and rhetoric and you're drinking the Kool-Aid, so tell us, one, what are they feeding you, what's the big message for SAP, and then let's break down kind of reality around mobile because mobile is their key investment area, obviously in memory and cloud with success is kind of all power in that, but at the end of the day, HTML5 analytics and all that in-memory stuff powers, essentially a mobile workforce. Definitely. Tell us what's going on. Absolutely. So there was their acquisition of Sybase a couple of years ago for $6 billion, you're really kind of starting to see that come together very well, they have all the pieces that you really need within mobile that are being offered by a number of different companies, but what SAP is trying to do is bring that together as one story for the enterprise so that you're basically managing the devices, you're managing the applications, and then you're providing analytics, and I think what the pillars that they're talking about here include mobility, but they also include AHANA, and so the idea here is kind of go beyond what the initial pain point is in the enterprise, which is locking down email, locking down those employee liable devices, and now providing an additional level of ROI with apps, and I think that SAP is rushing along with a lot of other companies to provide these applications, to provide that insight, and essentially provide the necessary data for you as an employee to make a decision just looking at your smartphone, or if you have more time at a tablet, and maybe manipulate that data, but all in a secure way, and that can be managed regardless of whether or not they own the device. So no doubt we've been talking on the Cube by Dave Alampay and myself, as well as talking to Schnabe and Dermot and all the top brass at all the times we've had with one of them. The messaging is good, I mean I've got to say SAP is impressive as a company, they're saying all the right things, at least from my perspective, in memory, totally aligns with the megatrends around infrastructure, from Flash, SSD, and all the innovations around Fusion, Solid-State, and the violin memory system, etc, etc, and with just as they say, they have mobile, which is a no-brainer, everyone's going to have a mobile device, and have a companion desktop and a TV, all that stuff's happening, you don't have to be a rocket scientist to figure that out, bring your own device to work, that's the consumerization of IT, that's happening with business, so they have also the cloud in there as well. So that's really good messaging, and no word of big data, I'll know the conversation, but mobility is really a good strategy, what are you seeing relative to the uptake on this strategy? Analytics we're hearing from some people, fantastic, however, there's a big gap between the business object guys and the analytics guys, because the app guys are saying, hey, I can do all this stuff, and the business object guys are like, hey, how do you integrate that into your ERP system? A small example, but you see, there's some things that have to get done, what's your take on it? Yeah, I think that, you know, the applications are really kind of where it's going to, you know, the message meets the road, I mean, there you have companies that are, they're getting their hands around this influx and invasion of BYOD devices, and now they're trying to figure out, okay, I'm building an app, I want to build an app, I want to have a presence on these devices, whether it's pointing towards their customers or pointing internally or to partners, but then getting that application out to the specific users, that's going to be the next key, and so you're seeing definitely SAP there, with SideBase and also with their previous products that SAP was offering, the ability to push the proper application to the proper employee to the proper device, and I think what's going to happen is a lot of that is out of the box applications, but in the next 18 months, you're going to start to see more and more companies wanting to use tools like the MWIRE platform to build specific applications for their employees for a specific business process. So we have a couple different trends, but I want to get your opinion on one is the application of life-cycle management, right? Let's get the app store out there, the guy they're pushing, but also from a customer environment, people really don't know how to put their arms around it, around mobile. What KPIs are you seeing out there, or ROI models to justify these kinds of deployments, because, you know, for a big company to go down this kind of SOA route or application, you know, portfolio or app store now, catalog app store, same thing, but it's a good business model, it's the right direction. So what are the challenges there? I mean, well, how do you put an ROI model together, and then how does that affect the actual porting of these apps? Yeah, I mean, it is, it's hard to put a specific ROI number on mobile. I think what you find is that as you are looking to compete in a market, you kind of can go back to will mobile change my business model? Yes, will mobile make a loan, make me more competitive? No. What you need to do is align both your business model and the use of new technology like mobile to make sure that, you know, you're getting the tools to the employees that need them, and I think what we find is that there are examples where it's not a specific ROI that's directly tied to the device, it's tied to other things. So an example was American Airlines, they have been a strong adopter of tablets to be used by their pilots in the cockpits of planes, and what they found was it wasn't, you know, there were definitely time savings, definitely some backs that were spared by not having to lug those huge, you see the pilots kind of go into the airport and they have that large case with them. Those are all the documents they need, so the bigger the plane, the bigger the case, and what they have found by going to tablets that they have saved a fair amount of money in fuel just because they're not carrying 20 or 30 pounds times two for every single plane. And so there are other ROI's other than, you know, what's the specific maps, like for example, you have to line around, you know, latest conditions for the year. Yeah, absolutely. So let's talk about customer requirements and what do you hear in the streets, relatives, the reality of the SAP message and how it's translating in market. Is it translating well, are customers aligning with it? I'll see in some verticals like utilities, mobile's critical, right? Yeah, gas, mobile utilities, everyone's on the road, key aspect. Outside of those verticals, or even inside those, what's the challenges and what is the barrier to adoption? Because if mobile's a no-brainer, what's the inhibitor to that? Yeah, well, I think it's almost a question of when do you jump in? Everything is changing so fast right now, that if you jump in now, and you bring that tool on board, how quickly, you know, will you be up and running and how quickly will that be out of date? So I think what needs to happen is that companies need to have kind of like a, you know, do a small trial, understand, you know, what you wear and when you need it, and then roll that out, but be ready to update that as quickly as you can, because there's gonna be new devices coming out, there's gonna be a need to quickly update those applications that you push out to those devices, and then there's gonna be a whole delivery model where you may move from native to HTML5, and in that way, you don't have to go through a number of different steps like approval through a third-party app store, if that's the way you decide to do the application. So I think what SAP is doing here is trying to bring a group of products together that really address all the pain points around mobile that enterprises have. Let me ask you a question, because a lot of people don't know this, but side-based operates one serious mobile operation. So what do you know about that? Do you follow that at all? You're talking about side-based 365? Or you're talking about Safari and SAP, or? I don't know the actual names. All I know is that they're running millions of transactions on a system with SMS. Yeah, side-based 365, yeah. Yeah, I'm sorry, that's massive scale. So I actually didn't know that in detail yesterday. A lot of core competency that they brought to SAP, how's that translating internally within SAP? I think, you know, where I see that going is that you have a tool that can be used by SAP customers and partners to provide a messaging platform to their customers' mobile devices. So I mean, you have a competency of, you know, switching and connecting, you know, say two or more carriers SMS networks. If you can then take that knowledge and I think SAP is doing that with side-based to make that a tool to be customer facing, to push out alerts, to push out notifications. And, you know, I think what we're talking about the peering relationships that they have, is obviously realizing these guys are all peering. So they have their peer back. So in essence, it's transparent to the user, the customer could have full and to end security on a mobile device. That's the possibility, right? Yeah, I mean, I mean, that's pretty powerful. Definitely, yeah. I think that, you know, in IT, there's a lot of chaos because, you know, this is something that IT thought they had locked down. You know, mobile email was done. It was okay. Yes, absolutely. And, you know, every Fortune 1000 company had a bed in place. Everybody seemed to be pretty happy with their BlackBerrys. But then with the launch of devices like iPhone, others powered by Android, that really kind of changed things around. And then now it's become much more of an app battle. And that's where the chaos is coming in. So do I build the app? Do I buy the app? How do I get it to my employee? How often do I update it? How much am I going to have to actually pay to build this application and deploy it? And they have the phone gap, accelerator meals. Absolutely. Yeah, they have the platform with the iBake360 and other things. The question that I want to ask you is, the expectation is kind of low. So I'm not going to trash them for this, but the app store is kind of like, what the hell's going on? Oh, the ones that are off. Yeah, I mean, they're okay. I'm not falling out of my chair. Yeah, I mean, yeah, yeah, I got to have that. Yeah, I mean, I think that, you know, these are our apps that appeal to a large audience. I think they're almost kind of bookmarks for, you know, here's what's possible. Here's what we can provide. But then it leaves a large opening for SAP partners. And even those that are not current SAP partners that are accelerator developers or phone gap or sentia or, you know, cyclo was acquired as well. So there you have an opportunity for developers to step in and tweak these out of the box applications or replace them. And that's a good thing. What do you think that SAP needs to do to attract those kinds of developers? Because developers care about distribution and monetization. If there's not a lot of traction in the app store, there's no distribution, I can't get paid. Yeah, I mean, I juice the ecosystem, they lay out some, you know, some, some cash. Yeah, seed. I mean, it's called seed financing, you know, they got an accelerator with HANA, $180 million on a fund. It's a separate organization, they're writing checks for the ventures as well. Yep. Are they talking about, are you seeing any discussion around? Yeah, I haven't, I haven't heard that. I don't think that's a bad idea. But I think that there is a lot of emphasis on mobile development. I think a lot of it's on the consumer side. But when you talk about money in return for, you know, who's really going to be willing to pay for a mobile application. And that's going to be the enterprise. So I think, you know, SAP offers their, their global app store, which it covers desktop and mobile right now. I, you may, you know, I expect them to go into a private corporate facing app store. And that's where, you know, you'll get a more rich experience as an enterprise user in, in a, in a, in an app store for mobile. Right now you see, it's very hard for developers to engage with their customers through an app store, through, say, Apple's app store, or Google Play, or any of the other app, app stores, because there are, you know, there, there are barriers in place to kind of protect the users, which is a good thing. But if it takes you two weeks to change the storefront, your digital storefront, that's a, that's a no go for an app that costs $100 per user. And we're here with Chris Hazel 10 of 451 Group and Analyst covers mobile, mobile enterprise, covers SAP like a blanket, great conversation, really appreciate it. Final question, and then we'll end the segment is, what are you expecting to, to follow this next year between now and next year? One, what are you going to be following? What do you expect to see? Yeah, I think that the, again, I've kind of probably hit on this a little too much, but it's really the battle of the app. And I'm expecting to see a lot more interest by the corporate to tweak and build these apps. So, and, and, you know, buy some of the out of the box apps that you know, you're not, you're not so hot on, but definitely they'll fit the need in a short term. Later on, you'll see a lot more developers focus on the enterprise and build the necessary apps that do that will get you excited and we'll get the enterprise excited. Okay, Chris, thanks so much for your commentary. We'll be right back. This is the queue. We'll be right back on our next guest of the short break.