SAP launches biggest software upgrade in 3 years

NEW YORK, Feb 4 (Reuters) - German software giant SAP AG (SAPG.DE) introduced the biggest upgrade to its business software in almost three years on Wednesday, saying it will help companies save money as the deepening recession hurts profits.

SAP will sell the new Business Suite 7 in bundles designed to help companies manage needs unique to their industry. For example, retailers get packages that help them coordinate product pricing with cash register systems, along with personnel issues and customer satisfaction data.

Pharmaceutical maker Roche (ROG.VX) said it plans to use the product to help better coordinate clinical trials, work with suppliers and human resources.

But analysts say SAP faces an uphill battle in offering a software upgrade in the midst of a global recession. SAP itself last week announced plans to cut spending, including eliminating 3,000 jobs.

"I don't think anybody has a clue as to what is going to happen with the selling of this product because there is so much uncertainty in the program," said AMR analyst Bruce Richardson.

He added that SAP's challenge is to effectively market the product as one that pays quick dividends, even in the midst of the recession. Business Suite 7 can also help businesses manage areas including accounting, sales, and manufacturing.

"It's about convincing customers that there is a sense of urgency to do something quick," Richardson said.

In most cases, businesses are only willing to invest in new technologies if they see convincing evidence that it will generate a quick return on their investment -- either by saving money or boosting their productivity.

About 35 percent of companies are delaying or canceling software upgrades originally planned for this year, according market research firm Information Technology Intelligence Corp.

A major upgrade often costs millions of dollars as large corporations pay upfront costs for the software in addition to hiring technicians and consultants to help integrate the new programs with existing systems.

Businesses also tend to proceed cautiously with upgrades out of fear that glitches could interfere with their operations.

SAP -- whose chief rival is Oracle Corp (ORCL.O) -- counts Airbus [ARBU.UL], Procter & Gamble (PG.N), Motorola (MOT.N), Apple (AAPL.O) and Audi (NSUG.DE) among its biggest customers. Its shares rose 2.48 percent to 28.71 euros in Frankfurt while SAP's New York shares rose 1.56 percent to $37.11. (Reporting by Jim Finkle; Editing by Derek Caney)

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