SAP’s Byzantine licensing leaves its customers feeling exposed

SAP’s complex and “opaque” licensing conditions means the majority of its users think they are exposed to “incalculable” financial risks when third parties dip into their systems.

A survey of German SAP user group members by SAM specialist SecurIntegration showed that over half thought they were “possibly” or “very probably” exposed due to “indirect use” of SAP.

Indirect use occurs when third parties access an SAP-based system, for example when a customer orders an item from a retailer and a stock check is carried out on the SAP stock list. SAP’s ts&cs regard this as “an additional user right” under its List of Prices and Conditions (LCP), which is subject to a fee.

It will be no surprise to anyone familiar with enterprise systems that the exact situation is, as Securintegration puts it, “complex, legally disputed and opaque”.

The firm, which offers SAP license management services, claims “in many firms using SAP applications, there are different LCPs and...the vast majority of customers are unclear about their current contractual conditions.

“The potential additional licensing claims mean that SAP customers are exposed to an incalculable financial risk.”

SAP, in common with enterprise giants Oracle and Microsoft, is often embroiled in licensing spats with its customers, who often live in fear of audits.

Last year SAP denied it had changed its licensing, following claims that audits were being used to charge extra under existing licensing agreements. Indirect use was one of the potential pitfalls raised at the time, and was tripping up previously compliant customers.

SAP at the time insisted that it had not made any unilateral changes to its contracts, and no change would ever be retrospective on previously signed deals. At the same time, it said was working with customers to help them “better understand” their agreements, particularly where they had been in place a long time. ®