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Indirect Access licensing [shutterstock: 1017657838, vchal]
[shutterstock: 1017657838, vchal]
Blog Nomen Nescio

Indirect Access: The Walls Are Closing In

Customers are growing more impatient for SAP to resolve the licensing issue. The ERP company has to earn customers’ trust back after SAP lost it by introducing Indirect Access.

A while ago, the head of the sales team and our legal advisor paid me a visit to discuss our ongoing contract negotiations with SAP regarding Hybris, Concur and Ariba. Of course, licensing model Indirect Access came up as well.

Our negotiations with SAP are very ambitious and lively. In our opinion, we’ve reached a tipping point – and we have to have an alternative strategy to deal with Indirect Access. The head of our sales team and our legal advisor came up with an innovative solution.

US GAAP versus Indirect Access

If SAP remains stubborn and uncompromising regarding Indirect Access, we will pay the SAP software maintenance fee under reserve. With this approach, we don’t neglect our contractual obligations and SAP still provides maintenance services. For customers, this is a win-win situation.

SAP, however, would suffer consequences. The company prepares its financial statements in accordance with US GAAP. Because of the United States Generally Accepted Accounting Principles, paying under reserve means that only revenue that is generated beyond doubt may be recognized.

If customers would follow our example, SAP’s balance would look pretty meagre. Financial analysts wouldn’t try to understand the complex licensing reasons. Consequently, SAP’s stock price would take a hard hit, and CEO Bill McDermott would have to kiss his million-dollar salary goodbye. End of story.

I’m not saying that everything was better in the good old days. All I’m saying is that if times were different, supervisory board member Gerd Oswald and former CTO Bernd Leukert would have climbed into their private jet and come to us to resolve the issue before it could escalate.

As things are now, SAP customers can only try to find solace in the US GAAP.

Voice tackles licensing issue

There’s something else regarding Indirect Access that SAP might want to take care of. Voice, an IT user group, has filed a lawsuit with antitrust authorities against SAP.

I’m no lawyer, so I can’t evaluate possible consequences or the importance of such a lawsuit. However, I do know that Voice is not alone – many lawyers have since come forward to say that SAP’s interpretation of operability and Indirect Access is unlawful.

Even though Voice has excellent legal representation, what it is lacking are witnesses. Antitrust authorities need SAP customers who have suffered financial losses or something to that effect to come forward.

The SAP community has to bond together. We have to stand our ground if we ever want to even stand a chance to defeat the licensing nightmare that is Indirect Access.

Source:
E-3 Magazine May 2018 (German)
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