SAP AG scraps on-premise maintenance fees for customers who switch to cloud

Enterprise Applications

by Joe Curtis| 25 July 2013

Move ‘addresses concerns over cost of running both on-premise and cloud’.

SAP AG has announced that customers who migrate services from on-premise to cloud will no longer have to pay licenses or maintenance fees for the affected services.

Companies using the enterprise resource planning (ERP) firm's on-premise solutions can now reallocate elements to the cloud, replacing the maintenance fees with a cloud subscription.

By extending their services into the cloud they can also take advantage of software from SAP companies such as Ariba.

The move has been welcomed by the UK & Ireland SAP User Group, which has been pushing for such an incentive for businesses to pick a hybrid strategy.

Philip Adams, chairman of the group, said: "It's really good to see that SAP has taken on board the feedback from SUGEN and the UK & Ireland SAP User Group. Back at our annual conference in November we highlighted that our members felt SAP was not making it attractive enough for on-premise customers to migrate to cloud solutions.

"In fact, the vast majority felt they should be offered discounts or the ability to trade-in on-premise licenses for cloud solutions. Over the last six to nine months we've been actively engaged with SAP on a number of issues related to licensing, maintenance and cloud.

"This is one of the first tangible changes it has made to addressing customer concerns.

"SAP is clearly demonstrating that it is listening to customers who simply could not justify investments in cloud when they had already spent significant sums purchasing on-premise software.

"They are really taking a lead by allowing customers to partially terminate their on-premise software licenses and therefore the associated maintenance costs. Furthermore it appears SAP will be offering discounts on subscription fees depending on the level of past on-premise, and future cloud, investment."

However, SAP AG confirmed to CBR that there is no retroactive element in the offer for customers who already use both cloud and on-premise.

But a spokeswoman said customers already using both services are eligible if they wish to end on-premise licenses and maintenance fees and expand into the cloud.

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