What do you get when legalese interpolates with sophisticated software? You have something called a software license. Software licensing, in general, can take off far from simplicity towards the side of convoluted and is just as intricate as the technology rendered through the contractual agreement itself. The enterprise software licensing titan, SAP, has recently made attempts to alter their reputation — — which historically, has been that their licensing models were vague and “too complex,” reports PC Magazine. They have made adjustments to their extensive price list.
SAP has rolled out over 30 bundles of software constructed for particular buyers and business infrastructures. The newly registered packages will help customers pay for only what software bundles work with their organization, instead of having an excess of applications not needed. SAP is also offering a procurement for licenses with the recent price changes. The issue, however, is that the pricing guide used to calculate the pro-rated amount is the one that was active at the time of the agreement — not the current discount list pricing.
Supposedly, the procurement offers a way for a company to cut on maintenance costs for unused licenses. The best way for a company to figure out which license types are needed and for which applications, tracking users’ activity is beneficial. By categorizing users this way, it will be easier to see the number of permissions required. The interesting thing about the pro-rate is that by the SAP’s admission, the procurements calculated may not economically provide companies a better discount than the original contract pricing due to “a very complex licensing legacy,” said SAP executive, Jens.
SAP’s licensing model relies on metrics of users and usage. For a company preparing for a SAP audit, or wanting to get the most out of their contract, it would do them well to set up an internal system of notifications for tracking usage to know when the number of application users has reached near full capacity. Mr. Bernotat stated that only some customers would pay less because it is “difficult… to predict what will happen” when they evaluate.
Companies can also create special license types. These, of course, will be unofficial and undocumented in the eyes of SAP because they are laid out by the local SAP office. Each user must then know the parameters for their accessibility, should additional licenses be required. The licensing management within a company has to ensure that the number of users active within the timeframe of the contract does not exceed the number outlined in the agreement. Learn more about SAP licensing.
While SAP offers several license types, there once were three main types that they sold: Professional User, Limited Professional User, and Employee User. Now, they have eliminated Limited Professional User, as well as, a few others. The removal of the Limited Professional, in particular, has dissatisfied many organizations. The Limited Professional was a midpoint that many favored since there is a significant price difference between Professional and Employee users. SAP, however, has introduced other license types. They are not necessarily replacements for the ones removed, but they provide buyers with additional licensing options that will hopefully be sufficient for their needs.
To prevent overspending on licenses or to avoid contractual non-compliance by having too many users active within the agreement’s criterion, SAP should introduce a monitoring tool that streamlines the management process. It is evident that SAP is trying to find ways of satisfying their customers. The few significant changes they have implemented may help organizations with licensing and prices, but there still seems to be an opportunity for more to be done, so that eventually the opinion of complexity regarding their licensing model can cease leaving its residue on their business.
