A rant on new questions raised about the maintenance fee and a look at the fact that customers will have to pay for SAP LVM Enterprise Edition. What is the sentiment of the customers, is it justified and what information is out there.
Not so long ago I wrote a blog which contains information on a new SAP products which is to a large extent interesting for SAP system administrator: SAP Netweaver Landscape Virtualization Management. In the blog post Virtualization and Cloud – Landscape Virtualization Management I discussed the available editions and licensing model provided by SAP.
After having received multiple questions about why SAP is charging customer for the enterprise edition (both in comments and on the side track through twitter or mail or other channels) I decided it was time to start asking questions.
The wind is blowing which way?
I think I already blogged this in the past: sometimes it seems a finger is held into the air and depending on which direction the wind is blowing in, a piece of software, or an appliance or whatever is being sold is more expensive or less expensive without any justification to why it is like that. It’s not only SAP that is doing this, other big software companies and even smaller software companies seem to have similar strategies in place.
Maybe I should try to challenge a sales representative into a game of Battlelore, the winner determines the license cost. I play to win and I’m good at strategic board games.
Of course we have to be realistic, it’s business and it’s normal to some extent. Some customers are just huge and have tons of SAP systems in place, hundreds of SAP licenses in place and they fund SAP much more than others so they also benefit from having certain discounts and special arrangements.
The competition thrives on this
I just stated it’s normal but what if the competition comes up with a different game plan. A plan where the customer doesn’t have to pay a maintenance fee and still gets new content delivered. That would stir things up no?
Well actually the competition has already started doing that and they are more than happy to highlight it in their “big” events (which can be compared to SAP TechED). By asking customers to stand up that switched to their product suite and by highlighting the fact that they are now no longer paying maintenance fees they are really rubbing it in and they have a good point. It’s an advantage of their product compared to what SAP is offering, one that cannot be denied.
The sentiment within the SAP community is that something is off and that there is something wrong with the concept of having to pay for SAP LVM Enterprise Edition. I state this after having talked with multiple SAP basis administrators at SAP TechED and afterwards with other community members once the news was out and there were more details available on the licensing model, the same sentiment was there.
It’s not my desire to harm the product SAP LVM as I believe it holds added value and the team reached out to me to collaborate and they shared information with me. For doing that they gained credit for sure because they show the new SAP at work, connecting with a community member and honestly wanting to collaborate, requesting feedback and improving their product based on that feedback.
I hope it doesn’t jeopardize the collaboration that has been going on but I wouldn’t be me if I didn’t blog about everything that has been going on, the sentiment of many community members and questions that we are stuck with on which we don’t have a clear answer (yet?). I invite you to read on but I also ask you to keep in mind what I mentioned in the previous paragraph.
After watching the executive Q&A session of SAPPHIRENOW 2011 with Jim Hagemann Snabe (co-CEO of SAP) and hearing his answer on the question of whether SAP HANA should be free for customers, I tried to understand how that answer relates to the proposition made by SAP on how they want to license SAP LVM.
You can watch the Q&A session replay online (requires logging in) The question is asked at around 28:05.
Please note that I’m not using Jim Hagemann Snabe’s exact words here but rather an interpretation of what was being said:
Customers go for Enterprise Support to keep their systems running optimal. The maintenance fees are used (among other things) to fund the innovation that takes place on the core of SAP. For the innovation on the core of SAP, the example of “not needing an upgrade” to insert new functionality into SAP Business Suite was referenced.
Providing new functionality that previously could only be provided by others which also make you pay for it does not fall under the maintenance fee. This referenced the fact that SAP HANA will not be for free.
A grain of salt
SAP still has to prove that you don’t need to put in a lot of effort to insert new functionality into Business Suite. This is what they promised with the enhancement packages when they were first introduced and, in my opinion, SAP failed doing that. A blog that tackles this question is “Have enhancement packages lived up to their hype?”.
At SAP TechED Madrid SAP again made a promise by stating they will deliver new functionality in the future for the Business Suite without disruption. Only time will tell if they succeed this time around.
Not all SAP competitors are charging their customers for having in-memory technology in place but then again none of the SAP competitors can offer the same speed SAP HANA is able to offer right now.
Focus on SAP LVM
Let’s focus on SAP LVM again. The question becomes: “Is SAP LVM as a whole or the functionality that SAP LVM brings part of the core of SAP?”. I wouldn’t say that all the functionality of SAP LVM is part of the core of SAP but at least a significant part is in my opinion. A system copy or refresh for example is part of regular SAP system operations which are handled by SAP system administrators.
System copies have been around for a long time already and SAP has built best practices for it, guides, tools (using sapinst) and so on. In other words, it’s not new functionality. The LVM implementation is innovation on functionality that was already there and therefore I consider it to be part of the core of SAP.
Thoughts on Enterprise Edition
Without having further information or answers to some burning questions it seems that in order to be consistent with what was stated by SAP, the Cloud & Virtualization team should move some of the functionality that is supposed to only be available in the Enterprise Edition (ref my previous blog Virtualization and Cloud – Landscape Virtualization Management) of SAP LVM to the Basic Edition of SAP LVM.
The only way the license cost can be justified is if SAP has near future plans to do accelerated innovation on SAP LVM and therefore needs to license it in order to fund the innovation (according to the answer provided in the Q&A). Questions keep popping up in my mind however because the only future innovation in the same product line area I have seen on the slides so far are project Xenon and project Titanium and I doubt anyone is going to get those for free.
I don’t know who is making the decision which features belong to SAP LVM Enterprise Edition and who decides that the product has to have a license cost so perhaps the team itself cannot help the fact that is the way it is right now. Another fact is that I don’t yet know the price that is being asked for SAP LVM Enterprise Edition. For all I know it could be ridiculously low but I don’t have any idea yet.
All I know is that there is a negative sentiment in the community towards the fact that SAP is licensing features like the system copy and system refresh which are currently part of the Enterprise Edition. Without further information I share the same sentiment as a lot of my fellow community members, certainly after watching the Q&A session replay that was mentioned in this blog.
Of course this blog contains assumptions, something I don’t advice and a topic on which I recently blogged on my person blog: “Waking up and seeing the light”. The fact of the matter is I asked questions to SAP but I have not been getting any answers so far.
That only leaves me with the option to blog on SCN and share my thoughts and inevitably make assumptions and hopefully those will lead to more information. That information can prevent me or anyone else for that matter to make further assumptions on the topic and that’s an important pointer of SCN.
I must be hitting a nerve by asking these questions because none of the answers are coming back.
I invite SAP to comment on this blog and provide the community with answers because I think it’s clear there are questions, certainly around the need to license SAP LVM Enterprise Edition and in general around which innovations are funded by the maintenance fee and which innovations are not and how SAP sees this in the future. Especially now that the competition is calling them out on these facts.