The jointly development database offering was unveiled at the SAP Sapphire conference in Copenhagen yesterday.

Bernie Spang, director of DB2 marketing at IBM, told ComputerWire that the new DB2 version is targeted at customers running SAP applications and comes with several configuration and performance tweaks to ensure smooth integration of the database system in SAP environments.

Spang highlighted features like autonomic (self-tuning and auto-configuring) capabilities that are provided as part of DB2’s ‘SAP Tuner’ feature, which he said makes SAP installation more silent, as well as dynamic storage allocation, support for multidimensional clustered tables (for optimizing SAP’s Business Information Warehouse), and improved SQL optimization for SAP data tables.

The SAP version of DB2 falls under the DB2 8.2.2 (previously codenamed Stinger) version. It is expected to be generally available at the end of this month. Over 5,000 new licenses of DB2 8.2.2 have been shipped to date.

Spang said the move is a direct challenge to its chief database rival Oracle which is estimated to have a 60% share of SAP’s installed base (around 4,400 sites).

Its directly targeted at increasing our share of SAP deployments that are locked into Oracle, he said. Spang said there was no special pricing for the new version, but added: We continue to offer discounts for clients migrating licenses from other databases.

But this is not just about displacing Oracle databases. As customers expand their SAP implementations they can get serious maintenance and performance benefits by switching to DB2. This translates into a significantly lower total cost of ownership.

IBM and SAP have been working closely since 1999 on integrated solutions development. This latest product announcement marks the beginning of a new multi-year technology, sales and marketing alliance between the two software firms.

IBM says it is working with SAP on joint sales activities to target the mySAP Business One and All-in-One customer base. It is also committed to offering worldwide support for the new database version through jointly staffed integration and competency centers.

Spang could not comment on IBM’s plans to retro-fit other products in IBM’s middleware stack for SAP or other specific applications providers. I can’t say yes or no at this stage.

Separately, SAP and IBM also announced they have both struck a deal with fashion retail chain Fossil to provide software and services for its entire 120 store chain. SAP will supply merchandise management and point-of-sale management software while IBM will provide consulting services.

The contract comes on the heels of a strategic alliance inked by both companies last year aimed at helping retail solutions development.