Dec 19, 2017

SAP’s Concession: Changes to SAP List of Prices and Conditions 2017 (Q4)

For several months, the DSAG and SAP have been discussing how to deal with the controversial issue of “SAP NetWeaver Foundation for Third Party Applications” (NFW TPA) in the future. Additionally, in a publication on their network in August 2017, the DSAG discussed the revision of compulsory licensing for third-party supplier scenarios (SAP NetWeaver Foundation for Third Party Applications).

Some are already calling it a milestone.

Access to APIs no longer subject to compulsory licensing

Among other items, the DSAG clarified that the client or third party supplier code should run on the ABAP or Java Stack, so that a claim is made on behalf of SAP.

Why was this important? While runtime environments had been discussed in the P&Cs up to April 2015, SAP changed this in the February 2016 P&C. This change suddenly meant that applications accessing the data via APIs in the SAP tables also needed an additional “SAP NetWeaver Foundation for Third Party Application” license, which had resulted in a significant decline in requests.

This policy has now been reversed.

Ensure your SAP license compliance

Improvement in the SAP Basis portfolio

Furthermore, the DSAG communicated that SAP would internally clarify whether compulsory licensing will continue for applications that serve pure system administration, system monitoring, or system management.

In the 2017 DSAG NWF explanations under article 2.2, it states “Further cases exempted from compulsory licensing”: SAP now interprets compulsory licensing for NWF TPA so that [third-party/customer] applications that service the whole system administration, system monitoring or system management, do not trigger compulsory licensing for NWF TPA. SAP must internally confirm the implementation of this interpretation.

Meanwhile, SAP clarified this point internally and recorded it under article 5.13 in the current Q4 2017 P&C.

What does this change mean for SAP customers?

SAP requires customers to use the SAP NetWeaver Foundation for Third Party Application license if they want to run in-house developments (add-ons) or software from third-party suppliers on the NetWeaver Runtime Environment.

Two exceptions currently exist:

  1. In-house developments (add-ons) or third-party software do not access information (data) in the SAP tables (database).
  2. Add-ons and third-party software that only contain functionality for system administration, monitoring and management. [New since the Q4 2017 P&C.]

It should be noted that the Q4 2017 P&C change is SAP’s first real concession in this matter.

The terms system administration, system monitoring, and system management all belong to the SAP Basis portfolio. So included in this category are all third-party software for:

  • Identity management
  • Warranty maintenance
  • Security management
  • License management
  • Surveillance software (Monitoring)
  • SAP system copies

Not the best solution for customers

Although we very much welcome this development, we still believe that the SAP entire requirement was and is unlawful. SAP announced that it would make further changes by the end of 2018. Ideally, SAP should withdraw their request from the P&C. However, after three years of discussion, we do not really believe that this will happen.

A simple and cost-effective solution for all SAP customers would be a more practical resolution in this matter. We suggest a one-off lump sum of €16,000 ($19,000), as was previously done during SAP’s introduction of NetWeaver. In return, all SAP customers should have the unrestricted right to use non-SAP software on the SAP Runtime Environment, including access to data in SAP user tables.

Are you paying too much for SAP?

Topics: SAP