This is the first in a series of posts dealing with the SAP contract negotiation process. SAP’s market dominance often leaves customers with little negotiating leverage. Companies that have a well developed negotiation strategy, an understanding of SAP’s typical concessions, pricing structure and contractual “pain points,” greatly increase their chances of successfully negotiating with SAP. The…
On June 12, Marcus Harris spoke to members of the Distribution Solutions Council (DSC) on software licensing and how to use the contract negotiation process as a competitive differentiator. The DSC is an industry round-table of software executives with an interest in serving the distribution marketplace, exploring new ideas beneficial to the industry and discussing best…
In February of this year SAP eliminated its low cost maintenance option leaving new customers with a maintenance option priced at 22% of software license fees. With the influx of SASS and third party providers like Rimini Street, SAP’s 22% increase seems counterintuitive. SAP’s maintenance increase, though, brings it in line with Oracle – which…
SAP recently reported a steeper than expected drop in Q1 profits. SAP was apparently impacted by acquisition related costs, the weaker dollar and delayed investments on new software. If you are currently involved in a software acquisition with SAP, now may be the time to aggressively seek concessions as SAP may be more willing to negotiate in…
Matt Karlyn, an associate at Foley & Lardner in an article on SearchCIO.com states that “it is critical to make sure that the license grant [in a software license agreement] aligns precisely with how your company intends to use the software being licensed.” The scope of the license grant, as Karlyn suggests, is easily one…
Last month the BSA reached settlements with Ron Ayers Motorsports, Sentage Corporation and TruStile Doors, LLC. Under the terms of the settlement the companies agreed to pay the BSA $72,053, $80,000 and $92,500 respectively to settle claims that they were using unlicensed copies of software on their computers. Implementing a software license management program so that you…
SAP has eliminated its Basic Support maintenance option priced at 17% of license fees leaving new customers with only a maintenance offering priced at 22% of license fees. Original story located here. Given SAP’s new maintenance scheme, choosing a lawyer to negotiate your SAP software licensing agreement that knows what maintenance concessions SAP will agree to…
The National Consumer Council (the “NCC”) in a study reported here found that software licenses are confusing and have terms that protect the interests of the vendor over those of the end user. To anyone that has reviewed or negotiated a software license these findings are hardly surprising. Signing a license without first having the agreement reviewed…
In a January 28th article, located here, CFO magazine quotes Huron Consulting Group’s Jeffrey Szafran, as saying “revenue-recognition problems . . . are probably the leading cause of restatements among software companies.” The consequences of getting it wrong can be severe. NEC (as reported in that same article) faced with the prospect of restating earnings…