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SAP Introduces New Pricing Model for Indirect Access

In response to continued customer concerns about how to license for access to SAP products by third parties or by processes, SAP announced that it was offering a new pricing model based on indirect access.  Customers using SAP S/4HANA, SAP S/4HANA Cloud, and SAP ERP solutions should carefully evaluate the new license model offered by SAP to determine whether the new model will simplify SAP licensing and/or reduce the costs associated with use cases involving indirect access.  The new licensing model does not apply to SAP’s technology solutions (e.g., database, middleware integration, SAP Cloud Platform, etc.)

In the past, SAP customers paid for each user who accessed the SAP systems.  During software audits, customers faced compliance challenges when the SAP systems were accessed by third parties, or by digital processes and bots.  SAP is now allowing customers to license indirect access based on the number of transactions or documents processed by the system.   Customers will pay for the total number of documents the customer will have the ability to process during a 12-month period.

SAP’s new licensing model for indirect/digital access charges for nine types of documents that include sales, invoices, purchase, maintenance, time management, and manufacturing quality management.  SAP claims that customers will only be charged for a document once, and that some documents will be counted as fractions of documents (20% of a document) rather than a full document.  As an example, SAP offers the following:

SAP counts only the initial documents created.  For example: a sales document created by Indirect/Digital Access is automatically processed in the Digital Core resulting in the creation of invoice, material or financial documents.  SAP would charge only for the sales documents initially created and not for the subsequent documents.

To calculate the total license fee owed, a customer will be required to identify the document type, the document type multiplier, and the total number of documents in that document type the customer processed during the 12-month licensing period.  SAP has indicated that it will offer discounts for licenses that include processing larger numbers of documents.  Although it is not entirely clear, it appears that SAP will require customer to true up if the actual indirect access usage exceeded the licensed usage.

SAP advises customers that they can keep their current SAP license terms, exchange existing direct access licenses for indirect access licenses, or convert existing contracts to a new, consolidated contract.  Each customer should carefully evaluate all of its use cases related to the SAP products that now offer licensing for indirect access to determine whether a license exchange or a contract conversion make sense given all of its business objectives.  Customers converting to SAP’s cloud offerings may request that previously paid fees be applied to the purchase of cloud products.