Microsoft says relishes SAP competition

By Kim McLaughlin

COPENHAGEN, Oct 24 (Reuters) - A Microsoft Corp (MSFT.O) executive said on Wednesday the company's Dynamics business software held several advantages over German-based SAP's (SAPG.DE) recently released Web-delivered product and he was looking forward to the competition.

"We will meet them in the field. We love competing and we are excited by the upcoming battle," Microsoft Business Solutions head Kirill Tatarinov told Reuters in an interview.

SAP unveiled a long-awaited line of Web-delivered software last month named Business ByDesign, changing its business model with a one-size-fits-all, subscription-based package aimed at mid-sized companies.

SAP, the leader in the market for complex software suites for large companies, wants to more than double its customer base to 100,000 by 2010 by offering hosted business services software.

Tatarinov said Dynamics' core asset was it simplicity and ease of use, areas where he said Microsoft has invested heavily.

Many mid-sized companies already used the Microsoft infrastructure on which Dynamics is based, he said, and the company's broader software platform was an important advantage over SAP's products.

"There are many organisations that may not use Dynamics just yet, but many are already using the infrastructure that Dynamics is built on," he said.

Tatarinov said recent deals among makers of business intelligence software -- such as SAP's recent 4.8 billion euro ($6.83 billion) bid to buy Business Objects BOBJ.PA-- generally had not altered the market outlook from Microsoft's perspective and underlined that software acquisitions were notoriously difficult.

"On the one hand the purchaser...basically signals to the marketplace that they couldn't do it themselves, that they had to go after someone else to help them and it also signals from the seller that they don't see a whole lot of future being a stand-alone going concern," he said.

Microsoft last quarter started rolling out Microsoft Dynamics Live CRM, the first Web-delivered version of its customer-relationship management software.

Tatarinov said early customer adoption of Live CRM was going according to plan.

"It's going very well. We're staying the course. I would say from talking to the CRM team they're on track," he said.