SAP will shut TomorrowNow subsidiary by end of October

SAP plans to close its TomorrowNow software maintenance subsidiary by Oct. 31, having failed to find a buyer for the company. It will help TomorrowNow’s 225 customers to find new support providers before the company closes its doors, it announced Monday.

TomorrowNow built a business selling third-party support for PeopleSoft and JD Edwards applications at around half the price charged by the original software vendors, later adding support for Siebel and Baan software to its range.

SAP bought TomorrowNow in February 2005: the company offered a convenient way for SAP to get closer to customers of its arch-rival Oracle, which had acquired PeopleSoft and JD Edwards in 2004, and later snapped up Siebel too.

However, in March 2007 Oracle filed suit against TomorrowNow and SAP, alleging that they had gotten a little too close. Oracle charged that TomorrowNow employees had illegally downloaded support materials for PeopleSoft and JD Edwards products from an Oracle Web site. SAP has denied gaining access to Oracle’s intellectual property in this way.

Last November, SAP announced the resignation of TomorrowNow’s management team, and said it was considering selling the company. Both moves were seen as ways for SAP to distance itself from the activities of its subsidiary and clean up its reputation.

Oracle is asking for damages likely to total US$1 billion or more in its suit, according to documents filed with the court last month. A trial is scheduled for February 2010.

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Jim Love, Chief Content Officer, IT World Canada

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