​SAP tackles indirect access 'anxiety', updates corporate pricing and licensing

In response to the anxiety indirect usage of software licences is causing its customers, SAP introduced new licensing scenarios and options.
Written by Asha Barbaschow, Contributor

After winning a $70 million lawsuit against beverage company Diageo and going after San Diego-based brewery Anheuser-Busch to the tune of some $600 million, SAP has updated its corporate pricing and licensing schedule.

Speaking at Sapphire Now in Orlando on Tuesday, SAP chief Bill McDermott touched on the recognition that traditional approaches to business are being replaced by newer, more transparent, modern ways of thinking and acting.

"Empathy to action is a race without a finish line," he said during his keynote.

"In fact, I hear that indirect access is causing some anxiety out there -- so let's tell it like it is: Protecting IP and accommodating ways of doing business is a delicate balance."

As SAP attempts to main that balance, McDermott said there is more his company can do to show greater empathy for its customers, and as such announced simplified pricing models.

SAP's new pricing model for the Procure-to-Pay and Order-to-Cash scenarios in ERP -- ECC or SAP S/4HANA -- will now be based on orders.

"The procure to pay and order to cash scenarios will now be based on orders, which is a measurable business outcome for any business," he explained. "In addition, static, read access in third party systems is your data. Competitors charge you for static read in third-party systems, SAP will not."

Essentially, the data inside a customer's SAP system will not be charged to view outside of SAP.

"Indirect static" read is read-only and is not related to a real-time system enquiry or request and requires no processing or computing in SAP systems. It will also be included in the underlying software licence free of additional charge when a customer is otherwise properly licensed, the company explains in a blog post.

"SAP will remain a culture in pursuit of excellence," McDermott added.

"We have become a top 10 empathic company in the world economy.

"Technology's good to make progress, but we're never complacent when it comes to your satisfaction because you alone will determine whether or not we win or lose."

Software asset management provider Snow Software helps enterprises optimise and control SAP systems, contracts, licensing, and audit processes and commented that SAP licensing is complex, as the multimillion lawsuits have proven.

According to Snow Software SAP solutions technical architect Joachim Paulini, the noise around SAP and its licensing models is not set to go away any time soon.

"SAP's new proposal is to measure indirect usage based on orders, however, there is no indication what value will be attributed to these new license measures," Paulini said. "Organisations should look carefully at their own circumstances and verify whether the measure that SAP is proposing is a reasonable licensing measure for the purposes of their business."

Although available to customers at no additional cost, Paulini expanded that there will be no legal obligation to sign up to new proposals like "Static Read", and warned that organisations must evaluate whether they will be financially better or worse off based upon these changes.

"And of course, uncertainty remains relating to other Indirect Usage scenarios which have not yet been addressed," he added.

"SAP's push toward S/4 HANA in the cloud and IoT initiatives through SAP Leonardo will lead to data being fed into and out of SAP, which means that even companies that are ready to move are stuck and don't feel like they can because they can't be certain of licensing fees not arising further down the line," Paulini added.

Disclosure: Asha Barbaschow travelled to Sapphire Now as a guest of SAP.

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