SAP extends indirect licensing related programme to end of 2021

User groups extend cautious welcome to SAP’s extension of its Digital Access Adoption Program

SAP has extended its Digital Access Adoption Program (DAAP) until 31 December 2021, announced in a blogpost by Robin Manherz, executive vice-president and chief performance officer at SAP.

The programme was the supplier’s response to customers’ dissatisfaction about “indirect licensing”, made infamous by SAP’s High Court victory over Diageo in 2017. Indirect licensing refers to SAP customers being charged for the indirect use of its software via third-party applications.

The SAP UK v Diageo Great Britain case concerned Diageo’s use of mySAP ERP (enterprise resource planning) software for the management of manufacturing, stock and supply chain, financial reporting and control, and human resources. The judge ruled that Diageo’s business customers and sales representatives were within the ambit of SAP’s licensing controls and so were financially liable.

By spring 2018, SAP had developed a new pricing model for indirect licensing scenarios, which it said “differentiates between direct/human and indirect/digital access, while clarifying the rules of engagement for licensing, usage and compliance”. The model was said to enable customers to license indirect access use based on the number of documents created in an SAP ERP, thus avoiding friction with customers exemplified by the Diageo case.

This model seemed to build on the announcement made by then chief executive Bill McDermott at the supplier’s users and partners conference, Sapphire, in 2017. He said then: “The ‘procure to pay’ and ‘order to cash’ scenarios will now be based on orders, which is a measurable business outcome for any business. Static read access in third-party systems is your data, and so SAP will not charge for that.”

For the uninitiated, this might seem like a bland, technical statement, but the rapturous applause with which Sapphire delegates greeted it at the time demonstrated how important this issue is for SAP customers.

At Sapphire 2029, SAP announced that it would further seek, according to the new statement from Manherz, to “improve indirect access licensing transparency, predictability and simplicity by introducing the Digital Access Adoption Program (DAAP)”. The programme’s stated goal is “to help customers make the move to SAP Digital Access with complete confidence”.

When the DAAP was launched, the supplier had only intended for it to be available for one year. It has now decided to extend the DAAP to 31 December 2021.

This extension has been welcomed by the UK and Ireland SAP User Group, whose chairman, Paul Cooper, said: “We welcome SAP extending its Digital Access Adoption Program until the end of 2021. Licensing is an incredibly complex topic and the initial one-year period didn’t give customers sufficient time to properly go through the process.

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“We commend SAP for listening to its customers and extending the DAAP, and look forward to clarification about what happens beyond 2021. For instance, if a customer creates a new process that results in digital access in the future, what options are available to them without the DAAP? We look forward to further discussions with SAP, as our members continue to evaluate their digital access position.”

For the German-speaking SAP User Group (DSAG), Andreas Oczko said: “We always said that the Digital Access Adoption Program is a journey for the customers, not a weekend trip only. The customers have to check the financial implications with care, and that takes time. Therefore, it is the right approach for SAP customers, and the user groups as their voice, that the Digital Access Adoption Program has been extended until end of 2021.

“It rewards our combined efforts and gives the customers a great way forward and planning security in their digital transformation, especially in this extraordinary time.”

Geoff Scott, CEO of the Americas’ SAP Users’ Group (ASUG), added: “ASUG has maintained all along that it is critical for customers to have a clear picture of their licensing and indirect access circumstances so that they can remain compliant, mitigate risks and plan their futures. Continuation of DAAP should help customers see the path forward so they can reduce the uncertainties related to licensing and innovate without hesitation.”

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