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A temporary hiatus while conflicts are resolved

SAP Halts Activity on Indirect Access

By Dan Kirtley | February 03, 2017

Almost as soon as Snow’s SAP blog on the challenges of SAP licensing was published, this week SAP has announced it they will cease “sales activities” related to NetWeaver Foundation for 3rd-Party Products.

For the time-being this is good news for SAP customers as they will no longer be liable for charge against a particular category of Indirect Usage, namely when using SAP-integrated add-ons via the NetWeaver platform.

In a notification posted on the DSAG forum [1] on January 31, 2017, DSAG notified its users of the following (translated from German):  

“Until final clarification of the subject [surrounding NetWeaver Foundation for 3rd Party Products] all sales activities will be ceased.

All "unresolved cases" in the market to date will be resolved promptly.

On the part of the SAP, an escalation point (COO of the SAP country organization) on this topic was secured (as already provided).”

To be very clear and transparent, this is not a complete U-turn, more a temporary hiatus while conflicts are resolved.

Were SAP to completely backtrack however, it would mean a victory for DSAG in the battle over what is perceived as unfair indirect usage charges. Make no mistake, in terms of financial risk and potential exposure for SAP customers, this victory would be positive but not ground-breaking.

The announcement follows requirements set out by DSAG on December 13[2]:

In a meeting of the DSAG group on the topic NetWeaver Foundation for 3rd Party Products with affected member companies as well as representatives of the VOICE eV, the European CIO Association, and the SAP partner IA4SP, the following requirements were defined:

  • It is requested that SAP will not pursue the "NetWeaver Foundation" approach and cease all activities. This also includes the deletion of the relevant price list components.
  • Return to the “€250 SAP platform user”, i.e. be included in the price list.  

Background

In the third quarter of 2016, SAP bowed to the pressure from various user groups across the globe and made changes to their enforcement of the price and conditions list (PCL) with the intention of clarifying some of the definitions around SAP Indirect Usage.

Within the PCL, SAP required that users, in addition to the Runtime usage right of the SAP NetWeaver Foundation, must acquire and pay for an additional SAP NetWeaver Foundation for 3rd Party Applications on top of their existing Named User license.

Many customers saw this as an unfair shift of the rules and it was particularly frustrating to organizations who had been recommended to develop customer-specific solutions into their landscape by SAP itself.

Although this backtrack in policy will no doubt be welcomed, there is nothing to stop other amendments being made in the future as technologies evolve and SAP potentially looks to monetize external usage of its systems which do not involve human users.

Snow’s advice remains the same. Be prepared with a comprehensive and up-to-date architectural diagram of your SAP landscape and ensure that you optimize your SAP licenses on a regular basis to keep unexpected costs down. Then, when changes do occur, you will be in the best possible position to defend yourself against hefty audit penalties.

More on SAP Indirect Usage

Reserve your seat for Snow Software's webinar on  March 15th 2017 with SAP licensing experts Joachim Paulini, Brain Skiba, and Florian Timm Ascheri below! 

[1] DSAG „New Information on the topic of NetWeaver Foundation for 3rd-party Products“: https://www.dsag.de/news/neue-infos-zum-thema-netweaver-foundation-3rd-party-products

 [2] DSAG informs: Current status of license: NetWeaver Foundation for 3rd Party Products https://www.dsag.de/news/die-dsag-informiert-aktueller-stand-zur-lizenz-netweaver-foundation-3rd-party-products

 

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