Wednesday, March 21, 2012

More on SAP Mobile App Pricing

Last week I wrote an article titled, SAP Mobility and the App Pricing Problem, that stirred the pot.  I don't know if it was trending on Twitter that day, but in my little world it caused a buzz.  As a result of that article I received a near instant invitation to speak to SAP's Senior VP of Mobile Strategy Nick Brown, and Sybase's VP of Mobile Solutions Willie Jow.  Today I was honored to speak to both of them about SAP's mobile pricing strategies.

Let me start out by saying the SAP mobility team is smart.  They understand mobility, and the challenges that come along with it.  They also understand SAP, SAP customers and how the SAP partner ecosystem works. All of these pieces of the puzzle are on the table and are being aligned.  Not every possible pricing scenario is worked out yet, but most.

It must be recognized that enterprise mobility can be complex.  You can make it as simple as possible, but not simpler. ~ Einstein

Here is how I understand SAP's pricing based upon my call with Nick Brown and Willie Jow today.
  • First pricing option, there is now a per mobile user platform bundle that you can purchase.  The platform bundle includes a license of Sybase Unwired Platform, Afaria and NetWeaver Gateway for that mobile user.  Here is how it works - if you have 100 mobile users, then you purchase 100 platform bundles.  Each platform bundle allows for an unlimited number of mobile applications to access it for that specific mobile user.  The mobile apps are not included as you can develop them yourself, contract with a third party or from a vendor.  So the platform bundle pricing is uncoupled from the mobile apps pricing.  You can purchase mobile apps from SAP, SAP partners or other third parties.
  • Second pricing option, for small productivity mobile apps there is a limited run-time license (includes a one user license of Sybase Unwired Platform and NetWeaver Gateway) that is based on the estimated value of the mobile app.  This license is an incremental percentage of the price of the mobile app.  For example, if the mobile app sold for $50, a percentage of that fee would be negotiated as the license fee for SAP.  If the price for the mobile app was $19.95, the license fee would again be a percentage, but a lesser amount.
  • Third pricing option, Managed Mobility - (includes SUP/Afaria/Gateway) – in this model SAP's end customer is the SaaS or PaaS vendor.  SAP has developed a new license model to empower service providers to resell these platforms as a service to end customers.   This allows cloud based mobile app vendors to pay a fee to SAP based on end user subscriptions.
I know this article doesn't clarify everything, but it should at least be a good conversation starter when you next speak to your SAP AE (account executive).

SAP - if I have something wrong here please correct me!!!  My email is

Kevin Benedict, Independent Mobile Industry Analyst, Consultant and SAP Mentor Alumnus
Follow me on Twitter @krbenedict
Full Disclosure: I am an independent mobility analyst, consultant and blogger. I work with and have worked with many of the companies mentioned in my articles.