SAP announces fundamentally new approach to Indirect / Digital Access licensing

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Walldorf, Germany. After months of speculation and on-again, off-again rumors, SAP has unveiled the biggest update yet to its widely discussed approach to ‘Indirect Access’ licensing. Responding to mounting pressure from global SAP User Groups and two recent antitrust lawsuits, SAP has reworked its licensing model to prioritize customer value. Customers can now actively monetize their 3rd party integrations.

Criticism of the previous licensing model

A major criticism of the previous Indirect/Digital Access model: customers were suddenly asked to accept and pay additional licensing fees without giving consideration to the product mix of licenses they had acquired over the lifetime of their SAP deployment. Many organizations were suddenly facing significantly higher fees under SAP’s ‘Business Documents’ licensing model from 2018, which was based on documents within SAP systems created via 3rd party interfaces.

Licensed SAP Users that access standard SAP functionality directly, while using 3rd party applications with backend connection to SAP, needed to be licensed twice under the old model — for both a named-user license and any document line items created indirectly. In addition, SAP’s detection method for business documents vastly overstated the annual consumption numbers, which put customers at a further disadvantage.

Finally the focus is on the customer again

Seemingly no longer upset by the growing trend of customers investing in innovation, RPA and edge computing — under SAP’s new model customers will now receive flexible credit in the form of maintenance reductions or payouts for documents created indirectly within ECC or S/4HANA for their use of connected 3rd-party applications. SAP’s document payout program starts at $0.50 per created document with bonus payouts at the one million and ten million thresholds.

For companies generating upwards of a million business documents within SAP indirectly, this can mean a reduction in annual maintenance fees of $500,000. When asked for comment, SAP explained its new approach was inspired by a desire to reverse the trend of significant over-licensing in its customer base and to encourage innovation.

New program: “Beneficial Utilization of Licensed Software, HANA, and Interface Technologies (BULSHIT)”

SAP said it will continue to check customer’s document consumption rates annually and has pledged to keep its inaccurate counting methodology in place, which will make it even easier for customers to reach the ten million bonus tier due to inflated measurements. In this long-awaited overhaul of its licensing model, SAP finally brought its approach to Indirect Access fees in line with its corporate policy of “empathy towards customers”. The new program is titled “Beneficial Utilization of Licensed Software, HANA, and Interface Technologies (BULSHIT)” and will be made available later this month.

 

In a related internal memo SAP requested that internal teams start referring to April Fool’s Day as Fake News Day from now on. We’ll make sure to update this article when additional information becomes available.

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