SAP's Ariba Acquisition Raises Questions On Commerce Network's Open ERP Approach

SAP announced this week an agreement to acquire Ariba Inc., a cloud-based business commerce network, for approximately $4.3 billion ($45 per share). The transaction is expected to close in the third quarter of this year.

The announcement is just one of several significant acquisitions by SAP in the last year, and for the Microsoft ecosystem, it raises questions about the viability of plans announced in April to link Ariba's business commerce solutions with Dynamics AX. As part of that strategic alliance, Ariba will develop an adapter to enable Dynamics AX customers to connect to the Ariba Network. The move is seen as one of several enterprise-grade partnerships Microsoft is forming aimed at boosting the image and toolset of Dynamics AX in the marketplace.

The acquisition will combine Ariba's buyer-seller collaboration network with SAP's customer base and business process expertise to create new models for business-to-business collaboration in the cloud, according to company officials.

Analysts and pundits seem to agree on the importance of the acquisition by SAP, as well as the new possibilities it creates for SAP given the growth that Ariba has seen (38.5% revenue growth in 2011), the scope of Ariba's network (62% network growth in 2011), and SAP's customer list that includes many of the biggest buyers and suppliers on the planet.  But there are differing guesses on if and how SAP will handle its new SaaS business, including whether it should keep the service open to third parties like Microsoft, IBM, Oracle, and Salesforce. 

P.J. Jakovljevic over at the TEC blog has some thoughts about this announcement.