SAP Sees German Sales Growth Picking Up

HANOVER, Germany (Reuters) – Business software maker SAP AG expects double-digit growth in sales of software andsoftware-related services in Germany and in Europe as a wholethis year, its European sales chief told Reuters.

"I would like to see Germany also double-digit — this iswhat my expectation is," Ernie Gunst said in an interview atthe CeBIT information technology fair on Wednesday.

SAP’s software and related services sales grew by 7 percentin Germany in 2007 and by 11 percent in the fourth quarter. InEurope as a whole, they grew by 14 percent in 2007, andworldwide they grew by 17 percent at constant currencies.

This year, SAP expects its total software and relatedservice revenues to grow by 12 to 14 percent at constantcurrencies, excluding sales of products from recently acquiredbusiness intelligence software maker Business Objects.

Gunst said that despite nervousness in Europe about theeffects of a U.S. economic slowdown spreading, SAP had not seenany changes in spending plans by its customers and had notfrozen hiring of sales staff in Europe.

"We are getting nervous because everybody is gettingnervous," he said. "We have no changes in the economiclandscape when we talk to our customers."

Gunst said he saw Russia, where software and related salesincreased by more than 50 percent last year, continuing to be agrowth driver for SAP’s European sales.

Along with France, Britain and Germany, Russia is one ofSAP’s most important European markets, he said.

"Those four are a big chunk of EMEA," Gunst said. "If thereis economic slowdown, then it is clear the other countries willnot be able to make it up."

SAP shares were up 0.4 percent to 31.41 euros by 1214 GMT,underperforming a 1.4 percent rise in the German DAX and a 2.2 percent rise in the European technology index.

Separately, SAP offered its new Business ByDesignWeb-hosted software for sale at CeBIT at a price of 3,325 euros($5,048) per month for a basic package licensing up to 25 usersand 133 euros per month per extra employee.

SAP has said it will sell Business ByDesign, a key productin its drive to increase its customer base among smallercompanies, for $149 per user per month in the United States.

Gunst said it was too early to tell whether thesoftware-as-a-service model of Business ByDesign, wherebycompanies hand over some of their IT management to the softwareprovider, would sell well in Europe.

In Europe, it is available so far in Germany, Britain,France, Italy and the Netherlands. SAP aims to make thesoftware ready for the mass market by early 2009.

Software as a service is more widely accepted in the UnitedStates, where it was pioneered by

"For the moment, all lights are green," Gunst said.

(Editing by Quentin Bryar)