German software giant SAP has relaxed its contract policy, offering customers flexible on-premises licensing and maintenance termination options.
The new policy means that businesses will be able to swap existing on-premises licences and maintenance with alternative SAP on-premises solutions. This should mean that businesses will be able to save money by cutting maintenance costs for unused SAP services.
SAP also revealed that it will now let customers who do not want to use the new flexible licensing options to cut maintenance costs by completely dropping usage rights for certain existing software licenses.
Chairman of the SAP UK & Ireland User Group Philip Adams welcomed the changes, telling V3 that they are the first step in a wider push for the German firm to be more transparent and flexible with its customers. "We've been challenging them around licensing for the last 18 months to two years," he told V3.
"This is an indication they're listening. There's more to be done but it's a positive first step. They have addressed two of our key concerns. Users are concerned there's a lack of transparency and flexible options. They [SAP] are trying in these announcements to address these by making it clearer what you can and can't do."
Despite the positive feedback Adams said that there is still more work to be done regarding how SAP handles customer contracts.
"Every company has different circumstances around their current platform and what they're using SAP for and where they want to go in the next few years. All these contracts are different and can carry on for a long period of time so it's good they're providing new flexibility, but, I think they should go further and we'll continue to lobby for them to go further," he said.
"I also still think they could do more on the transparency front. There is a price list if you ask for it but there's a perception out there it's not as public as it could be and that leads people to believe there are companies getting a better deal than they have. If there was a public price list globally everybody knows what they're paying for and if they're getting a good deal."
Finally Adams added he would also like to see SAP let customers park services. "I think the devil will be in the detail when terminating parts of your contract, with you not being able to temporarily park them. That's what some customers are looking for as they know their business may have a downturn today but it may pick up tomorrow so they don't want to have to abandon software and then re-purchase it," he said.
"They want to be able to say, ‘hey look I just want to put that on the shelf for six months as I'm not using it and shouldn't have to pay maintenance on it but I may want to use it in six months. You can audit me for it when I have to use it again'."
The policy change follows an announcement by SAP that customers can reallocate some parts of their on-premises licenses to some of its cloud solutions. The initiatives come during a wider push by SAP to get more companies onto the cloud and using its advanced HANA platform.
SAP has consistently touted the HANA platform as the future of the cloud industry. The platform has proven to be a hit with many customers, with key companies like Qualcomm and McLaren Racing Team listing it as a key tool powering their businesses operations.
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