SAP to give on-prem customers three-year reprieve — with a catch

The clock is ticking for many SAP customers. The standard maintenance for SAP ERP and Business Suite is set to expire at the end of 2027. After that, SAP user companies would have the option to purchase the more expensive extended maintenance for an additional three years. All told then, migration to S/4HANA would need to be completed by the end of 2030. 

Although S/4HANA has been on the market for a decade now, many companies are still struggling to make the switch. The projects are complex, take a long time, and usually cost a lot of money. In recent years, numerous SAP customers have asked about the added business value of such an ERP migration — and apparently have not found a satisfactory answer. Because many projects are still stalled or have not yet even started.

Against this background, SAP has been repeatedly asked in recent years to extend the maintenance window for its older solutions by a few years. To date, SAP executives in Walldorf, Germany, have clearly rejected these requests from their customers. 

S/4HANA migration — postponed until 2033?

But now things seem to be moving. According to Handelsblatt, SAP is considering granting its customers a reprieve. However, this reprieve would require committing to SAP in the long term.

According to the report, companies that introduce the new product generation as part of the “Rise with SAP” program will be able to optionally use their old systems until the end of 2033. SAP confirmed these plans upon request, reported Handelsblatt. The software manufacturer explained that it would facilitate the transition to Rise with SAP and support “customers’ business continuity.” The option is called “SAP ERP, private edition, transition option.” Customers will receive more details, such as the price, in the first half of the year. 

DSAG: On-prem customers must not be pushed to the cloud

“In general, the delay is welcomed,” said Jens Hungershausen, chairman of the German-speaking SAP User Group (DSAG), commenting on the report. Recent surveys have shown that many customers are still in the middle of conversion projects or have not even started yet. “This measure will certainly be of benefit to these companies.” 

“The delay is obviously intended to win over customers for the ‘Rise with SAP’ program,” Hungershausen said, interpreting SAP’s change of strategy. “An understandable step by SAP in the course of its cloud strategy.” From DSAG’s point of view, however, this is unfortunately another measure “that gives the impression of forcing on-premises customers to switch to the cloud.” 

However, on-premises users must not be left behind, the DSAG boss has repeatedly demanded. “We therefore believe it is essential that SAP grants companies more flexibility, transparency, and freedom of choice when it comes to their move to the cloud or their desire to continue to rely on SAP’s on-premises software.”

While Hungershausen stresses that details are not yet known, “we are in a constructive and critical dialogue with SAP” on this matter, he said.