SAP is banking on its global data centre deal with IBM providing it and its clients with greater geographic reach. IBM has been selected as a “premier strategic provider” of cloud infrastructure to run HANA. According to a spokeswoman IBM plans to offer the service from its Australian SoftLayer data centres, the first of which has opened in Melbourne and also from its Sydney cloud services centre which will be available to run large HANA instances.

The software giant has already recognised the need for locally hosted services to address both data sovereignty issues and latency. In March SAP opened its own Sydney-based data centre to host SAP HANA Enterprise Cloud and the Business ByDesign ERP solution.

While it had hosted SAP Business ByDesign at a Sydney data centre since 2013, SAP said in March that it intended to consolidate its cloud services onto its own local data centre.

Now it appears that IBM will provide an alternative source of computing grunt to run the software cloud.

The companies are expecting the arrangement to be particularly interesting to organisations with a global footprint which may wish to start their HANA deployment locally, but then scale it internationally.

According to research firm Vanson Bourne there are already 35 million users of SAP cloud services worldwide – but it has predicted that a much as $A41 billion worth of the SAP landscape could move to the cloud over the next two years as existing on-premise SAP users continue to migrate to the cloud.

For IBM the relationship will provide an important global anchor client for its SoftLayer cloud services data centres.

IBM bought SoftLayer in 2013 for $US2 billion in a bid to catapault it further into the international cloud market.

Since 2007, IBM has invested more than $US7 billion in 17 acquisitions to accelerate its cloud initiatives and currently boasts more than 40 global data centres.