SAP takes wraps off cloud services initiative in China

SAP, the world's largest supplier of business management software, plans to ramp up the adoption of cloud-computing services by local and multinational companies on the mainland, following the launch yesterday of an expanded co-operation agreement with China Telecom.

A joint venture between SAP and China Communications Services (CCS), a Hong Kong-listed subsidiary of China Telecom, will now include delivery of cloud offerings nationwide, starting with advanced human capital management (HCM) solutions from SAP unit SuccessFactors.

German firm SAP said it was the first international software supplier to bring an integrated HCM offering - which companies use to automate employee recruitment and administration processes - under a software-as-a-service (SaaS) platform hosted in a mainland data centre. Telecommunications services firm CCS has signed up to be the first customer and is expected to have 12,000 users.

The ambitious initiative was part of SAP's ongoing five-year, US$2 billion investment programme in the world's second-largest economy, the company announced at an event in Beijing yesterday.

"This is a significant milestone in … our long-term commitment to the Chinese market," SAP co-chief executive Bill McDermott said. "We will continue to expand our ecosystem and will bring even more innovative cloud solutions to China."

Cloud computing enables enterprises to buy, lease, sell or distribute software and other digital resources over the internet as an on-demand service, similar to the way electricity is drawn from a power grid. Resources are hosted in data centres.