Software AG looks to reap what it SOAs

Service oriented architecture (SOA) will play a key role in Software AG's drive to become a €1bn company by 2011.

The German business infrastructure software maker is aiming to hit its revenue target by focusing on SOA as well as geographical growth and acquisitions where appropriate.

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Speaking to silicon.com, the company's CEO Karl-Heinz Streibich said: "We're on the road to being the next €1bn company."

Software AG has been expanding its operations in countries such as Brazil, Japan and South Africa and was recently named the fourth largest software company in Europe in terms of revenue by the 2008 Truffle 100 Europe list unveiled by the European Commission in Brussels. It trails SAP, Sage and Dassault Systems.

While Software AG pursues its growth dreams, the tech landscape isn't remaining static. "The big transformation [in the industry] is from silo-oriented systems to service oriented infrastructure," Streibich said.

He told silicon.com he believes the company can cash in on such growth and achieve its €1bn annual revenue target with the products it has.

Software AG intends to keep its strict focus on technology to help businesses modernise their legacy IT infrastructure, Streibich revealed.

"We will not go into applications - we will stay in the infrastructure space," he said.

The company claims businesses see such legacy upgrading as more cost efficient than a 'rip and replace' approach - handy when the economy is on a downturn.

The company also hopes to weather the financial storm through its licensing model - the majority of its customers have established licence agreements or a significant amount of operational expenditure tied up with Software AG.

Despite the financial belt tightening, Streibich said businesses will still invest in running and maintaining their IT infrastructure.

"I believe that we are very well prepared for the crisis now," he added.

Pierre Audoin Consultant's chief analyst Christophe Chalons echoed Streibich's predictions of ongoing tech spend: "There will be some adjustments but there will be no full stop of IT investment," he told silicon.com recently.

Software AG and its fellow vendors will have to cope with a European IT market on the slide. Analyst house IDC recently cut its predictions for 2009's worldwide spending growth rate from 5.9 per cent to just 0.9 per cent.