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 also charges 22%.
One strategy we have successfully employed for our clients wishing to reduce their maintenance spend is to include language in an SAP software license agreement that allows the licensee to “park users.”
“Parking users’ involves suspending the use rights and maintenance fees associated with unused named users for a period of time that is mutually agreed upon by the licensee and SAP.
In our experience, SAP is typically agreeable to suspending use rights and associated maintenance fees for a period of time ranging anywhere from a few months to a couple of years.
Typically SAP requires language obligating the licensee to pay a reinstatement fee and back maintenance fees if the licensee wishes to recapture the use rights associated with the “parked users.” Alternatively, the license rights associated with the “parked users” can simply be allowed to lapse.
When negotiating a software license agreement with any large ERP vendor, it’s imperative that your legal representation have practical experience. You want legal representation that has negotiated a large number of software license agreements with the particular vendor you have engaged, be it SAP, Oracle or Salesforce.com. Experienced software attorneys can leverage their experience on your behalf to help you negotiate a software license agreement that provides you with the greatest flexibility while minimizing your legal exposure.