Do SAP's licensing changes signal a break with complexity?

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Against a backdrop of multi-million dollar legal battles with high profile customers, SAP is trying to reassure its vast user base that it doesn't hold a grudge.

It's doing that by addressing an issue at the heart of its litigation - indirect licensing.

As systems become more interconnected, it's increasingly common for an ERP system to touch not just other aspects of an organisation's infrastructure, but third-party systems too, whether that's another firm's or a customer's device.

That's roughly the situation UK firm Diageo found itself in this year when SAP took it to court, demanding $54 million in damages for all the licenses Diageo hadn't bought for customers and staff accessing data via third-party applications that hooked into SAP's ERP and database software.

Diageo lost that case, though the damages are still to be decided. An even bigger $600 million compensation claim against Stella Artois brewer Anheuser-Busch InBev is underway - Anheuser allegedly allowed indirect and direct access without user licenses.

This left many of SAP's other 350,000 customers feeling uneasy. A poll conducted by the ITAM Review of its SAP Special Interest Group members found that indirect access was the greatest concern for 32% of respondents.

Then SAP announced a change in licensing to assuage these worries: instead of relying on a user license model by default, earlier this month the ERP giant introduced a different method of licensing - an order-based model.

For customers who use ECC or S/4 HANA, procure-to-pay and order-to-cash scenarios will both be order-based.

That means if you're buying new stock from a supplier (procure-to-pay), or a customer orders something from your website (order-to-cash), it's the order that will be priced, not the multiple touchpoints from a user to your S/4 HANA system.

Hala Zeine, SAP's head of commercialisation strategy, tells IT Pro the new model is better for both customers and SAP in transaction scenarios.

"How many orders we process to the customer is directly related to the value," she says. "The more we process, the faster we do it, the less time customers need to [spend on] this. This is all done real-time so this is much more valuable than looking at how many users touched the system as you go through these processes."

Indirect Static Reads (passive reads) - accessing customer data that was in SAP's database to read it (not to process it or to action a real-time system query) - will also be included in a customer's existing software license.

Read the full article discussing SAP's indirect access amnesty, the size of the change, simplicity and reassurance for customers via IT Pro.

Source: IT Pro.

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