SAP slows price increase from forced software-support migration
Computerworld - Bowing to pressure from user groups, SAP AG last week agreed to slow the pace at which its software support fees will increase under the mandatory Enterprise Support program that the vendor launched last year.
SAP and representatives from 12 user groups also announced a series of key performance indicators, or KPIs, that they have agreed upon for attempting to measure Enterprise Support's financial value to customers.
The forced switch to Enterprise Support has been a bone of contention ever since it was announced. In an initial attempt to appease angry customers last fall, SAP sweetened some of the program's features and extended the regular maintenance period for its core business applications from five years to seven. But the company didn't make any cost concessions then.
And last week, SAP said the ultimate price of Enterprise Support will still amount to 22% of software license fees annually. The company charged a 17% fee for its Standard support program, one of two lower-cost offerings that it eliminated.
But instead of applying the increase in four annual steps ending in 2012, SAP will now extend the phase-in period to seven years. As a result of the change, SAP said, support costs for migrated customers will rise by an average of 3.1% each year, instead of the 8% that users originally faced.
Reducing the annual rate of increase was one of the demands made by SAP's user groups. The list of KPIs that SAP and the user groups agreed on resolves another demand: finding a common way to assess the value of Enterprise Support.
SAP claims that the price increase will be justified by improved services, but the user groups want proof. To try to get it, the KPIs will be used in a joint benchmarking program, with the results to be examined by an independent auditor.
The deal isn't perfect, said the Francophone SAP Users' Club. But the group added that it is satisfied with the price-increase compromise. It also said that the agreement on the KPIs shows a willingness on SAP's part to go where no other software vendor has ventured before.
During a conference call on SAP's first-quarter results last week, co-CEO Leo Apotheker made a similar point and maintained that Enterprise Support "will become a competitive advantage" for the company.
Read more about Applications in Computerworld's Applications Topic Center.
- Best iPhone, iPad Business Apps for 2014
- 14 Tech Conventions You Should Attend in 2014
- 10 Desktop Apps to Power Your Windows PC
- How to Add New Job Skills Without Going Back to School
- Slideshow: 7 security mistakes people make with their mobile device
- iOS vs. Android: Which is more secure?
- 11 sure signs you've been hacked
Red Hat Enterprise Linux - The Original Cloud Operating System
Linux adoption is growing against a number of measures, such as the
number of supercomputers that run Linux and the size of the contributing...
- OpenStack Hype vs. Reality: CIO Quick Pulse Open-source architecture can enable IT departments to build infrastructure-as-a-service (IaaS) clouds running on standard hardware.
- Building a Bridge to the Next Generation Data Center Selecting a widely adopted operating system is a foundational component of a standardization strategy.
- OpenStack and Red Hat: IDC White paper Most OpenStack deployments are by public cloud providers that are early adopters of technology and use OpenStack in a do-it-yourself deployment and support...
- Live Webcast Best Practices for the Hyperconverged Enterprise Network To the Age of Constant Connectivity and Information overload
- Live Webcast Unmasking the Differences between Consumer and Enterprise File Sync & Share The consumerization of IT combined with the rapid pace of the modern mobile workplace is forcing enterprise IT teams to evaluate file sync...
- Live Webcast Government Agency Webifies Outdated COBOL Applications Let this CTO tell you how his agency converted 1980s-era green screens into an e-filing portal for the 100,000 cases handled each year...
- The New Way to Work Knowledge Vault This Knowledge Vault focuses on how, in today's increasingly virtual world, it's more important than ever to engage deeply with employees, suppliers, partners,...
- Getting Ready for BlackBerry Enterprise Service 10.2 Find out how BlackBerry® Enterprise Service 10 helps organizations address the full spectrum of EMM challenges, while balancing the needs of both the... All Applications White Papers | Webcasts