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SAP insists there are no changes in its software licensing terms

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December 8, 2015

Again today, ERP software giant SAP is insisting that there's been no changes in its software licensing terms, following a claim that certain audits have been used to charge extra fees to users under existing customer licenses.

SAP says that its policy on licensing terms has since remained and continues to be consistent. Additionally, the company says that, should changes be made they would not be applied to customers' existing licensing agreements.

SAP said this after it was contacted by a legal firm who claimed its client (a large SAP IT vendor) had been asked to pay the company extra cash following an audit they claimed changed the terms of a 15-year license contract.

The legal firm wishes to remain anonymous. According to the lawyer, their client – a prominent British retailer whose identity was withheld – signed up to SAP in the year 2000 under a per-CPU licensing agreement (perpetual license).

After a licence audit that was performed earlier this year, the client was informed that because each CPU running SAP's software had multiple cores, the customer was out of compliance and therefore owed SAP several million pounds extra.

Since 2000, SAP (like Oracle, Microsoft and many others in the IT industry) introduced per-core rather than per CPU licensing.

The company is understood to have had an agreement with SAP that changes cannot be applied to the license deal unilaterally, since they must be agreed to in writing only.

"We advised our client to say-- 'You've not set out the legal basis on which you are entitled to this settlement figure'," the lawyer said. His client is understood to have engaged with SAP and since then he agreed to an 80 percent reduction in the fee being claimed.

But to be fair to its users, SAP did land in hot water with customers over "indirect access"-– that is accessing data held in SAP systems without actually using SAP's tools.

A British firm (that asked to remain anonymous) specializing in SAP licensing matters told us it had recently worked with one customer who'd been tripped up by indirect usage. The company claimed knowledge of others also caught out by indirect usage as well.

According to that firm, indirect use is not something that had been in customers' original contracts. Organizations who'd been compliant in the past are finding themselves now *out* of compliance following those audits.

"We've seen this more and more in the last twelve months," the source added. SAP's spokesperson told us-- "SAP has remained consistent with regard to licensing of SAP software based on its utilization. Furthermore, even if licensing policy changes are made, any modification would not apply to customer agreements that have already been signed."

But she added that SAP is working with customers to help them better understand the terms of its user agreements, particularly if they have been in place for some time and their business has changed somewhat.

Source: SAP.

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