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SAP licensing: Complexity leaves users confused on cost

ERP specialist SAP is called on to simplify its software licensing to make it easier for users to pay only for the software and services they use.

SAP users are calling on the ERP software maker to simplify licensing and make its pricing more transparent.

Lack of clarity and flexibility when licensing SAP's products is leaving users unclear on whether they are paying for software and services they aren't using, according to members of the UK & Ireland SAP User Group.

Users said they found it difficult to establish which licences they needed through the lifecycle of their SAP software. This confusion stemmed from SAP software packages that come with multiple licences, which set different limits on usage rights.

The vast majority, 89 per cent, said they would like SAP to reduce complexity by offering software that is only limited by one licence or usage metric.

Paying for unused modules

In addition, more than two-thirds, 67 per cent, said they have found it increasingly difficult to track licence usage as SAP's product catalogue grows, especially as certain SAP modules can be installed automatically. As a result, some users ended up paying for modules they weren't using.

The bulk of those questioned, 88 per cent, want SAP to make its price list public.

Users also want SAP to be more flexible in its charging structure. Nearly all, 97 per cent, want support charges to be waived for unused licences. Meanwhile three-quarters said the base cost of adding functionality to core SAP systems was too high when that feature would only be used by a small number of employees.

Philip Adams, vice chairman of the UK & Ireland SAP User Group, said: "It is clear there needs to be greater clarity from SAP regarding licensing, much of which stems from a need for improved customer communication. For instance, more than half of users don't understand the difference between what SAP defines as a Professional and a Limited Professional User.

"Ultimately it should be in SAP's and its users' best interests to make licensing as transparent, simple and flexible as possible."

Cloud impact on licensing

The user group was also almost unanimous in agreeing that SAP hasn't effectively explained the migration path from on-premise to its mobile or cloud offerings and how this shift affects existing licensing agreements.

Tim Noble, managing director SAP UK and Ireland, said the company is "standardising our terms and conditions globally so that the same licensing terms apply, no matter in which country our customers reside, as well as publishing our software rights online for all SAP products and services - including the full Sybase suite".

The survey questioned 336 SAP users from 150 SAP user organisations in the UK and Ireland.

About

Nick Heath is chief reporter for TechRepublic UK. He writes about the technology that IT-decision makers need to know about, and the latest happenings in the European tech scene.

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