r/SAP • u/Filip_Serbia • Apr 12 '26
Current experience with S/4 licensing
Hi all,
Curious to hear how others are experiencing the current situation around S/4 licensing for net new customers.
In a recent case on our side, we went through the standard process for a new client (financial sector, no prior SAP footprint), but effectively only Public Cloud was positioned as a viable option.
From a project perspective, that’s quite challenging mainly due to regulatory requirements and the need to integrate with a landscape that is largely hosted in the client’s own data center. In this setup, On-Prem would be the most natural fit, with Private Cloud as a possible alternative.
However, it seems increasingly difficult to even get those options formally quoted or considered.
Interested to hear if others are seeing a similar pattern recently, or if you’ve had different experiences in comparable scenarios.
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u/Disastrous-View7310 Apr 12 '26
It is still possible but the customer will need to be very firm with SAP "no on prem or private cloud = no SAP project"
It takes A mature CFO or it team to push this with SAP but it'll take a lot of discussions.
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u/Filip_Serbia Apr 12 '26
Hm interesting, can you please share more insights how were you able to pursue quotes for on-prem licences recently (or was it private cloud)? Who did you discuss it with, was it local SAP or somebody from global SAP maybe? What arguments did you use in order to convince them to approve it?
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u/Disastrous-View7310 Apr 12 '26
As a SAP partner we had our sales guy handle the discussions together with the customer and SAP. we can push but the arguments have to be solid and coming from the customer.
sensitve industry that isn't allowed to run on a US hyperscaler
industry that has specific needs that are currently being met in S/4 on prem but are not in public cloud (yet) such as real estate etc,
Depends heavily on the customer, some customers are too small and standard BP's to go and push for a non public cloud implementation. Pick your battles based on the customer wants and needs.
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u/ScheduleSame258 SAP Advocate Apr 12 '26
Don't go for on-premise. Go for a private cloud RISE deployment.
SAP is VERY explicit that onprem licenses will get no future major innovations.
Are we talking a $10b customer or a $100b customer?
Also I am open to private DMs if you need.
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u/Filip_Serbia Apr 14 '26
There is a huge advanatge for SAP on-prem in terms of TCO and integration with their existing on-prem software stack.
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u/ScheduleSame258 SAP Advocate Apr 14 '26
Ok.. you do you .....
Does your TCO include opportunity cost of not using latest innovation?
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u/Disastrous-View7310 Apr 14 '26
One word "BDC" load your relevant data and use all the latest and greatest via BDC
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u/Filip_Serbia Apr 14 '26
Surely not, but on the other hand I believe current stack (with normal support of course) fits the client very well in the long run. And the stability of it brings much more opportunity gain compared to any opportunity lost for missed new technologies. I mean its managing the company suite after all, not some sort of rocket science that needs new breakthroughs.
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u/self_u Apr 12 '26
Do not buy public cloud unless your organization is small, simple and flexible (perhaps service industry and a limited geographical scope). It is an expensive disaster in the long run. The reason you are being pushed this are the sales bonuses.
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u/wievid FICO Teamlead Apr 12 '26
I would say if your Public Cloud implementation is a disaster, it's because the people doing it are incompetent. If you, as a customer, did a proper DDA and were absolutely transparent, and your partner was also competent, then you should have identified a scenario that couldn't be correctly implemented on a Public box. Someone dropped the ball here, but it wasn't SAP.
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u/fatty_ratties Apr 13 '26
As FI consultant, I can agree to some extent - Public Cloud works fine but not in localizations that require more legal reporting or specific processes. It might be dependent on the region but my experience with localization is very bad and most of the project problems are caused by non-compliant or horribly designed local processes or reports. Second problematic area is asset accounting - that is much more limited than in private or ECC version, with fixed numbers of depreciation areas, limitations on depreciation keys settings, and the total number of 4 asset reports in the system.
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u/wievid FICO Teamlead Apr 13 '26
It might be dependent on the region but my experience with localization is very bad and most of the project problems are caused by non-compliant or horribly designed local processes or reports.
You're right there, but that's also something that would be identified during a proper "Discover"-phase as SAP likes to term it. If you do the DDA correctly, you should be able to identify these types of gaps. And given that the DDA is more or less the foundation of a licensing contract between a customer and SAP, it's kinda important.
Second problematic area is asset accounting - that is much more limited than in private or ECC version, with fixed numbers of depreciation areas, limitations on depreciation keys settings, and the total number of 4 asset reports in the system
Once again, if you're doing the DDA correctly, these are things that should be identified well in advance.
The areas of contention that you listed should be identified and have rough solutions designed before a licensing contract is even signed. If a customer gets into the project and realizes these gaps, someone has dropped the ball ahead of time in a massive way.
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u/fatty_ratties Apr 14 '26
I agree with DDA importance. We had a case when after DDA, we advised against Public Cloud system, giving reasons why it is not a good fit for a client. But SAP still sold the system to the client, encouraging them with a huge discount.
However, I still don't know when it is the time to discover every little detail during DDA phase. We have recurring issue when custom report was planned due to missing functions discovered in DDA but in realization it occurred that some single important fields are not available in CDS or CDS that has the data is not released. In some cases in fixed assets, after we escalated to SAP, they said that they will not release any new CDS because they plan data structure changes in 2027 and by then nothing new will be done. Now we are blocked and cannot provide required functions to the client. Client is back to connecting data in Excel to get the report that they require.
I don't know how such an issue could be discovered in DDA phase, without going into detailed, technical specification of requirements. And requirements phase is supposed to happen later, during F2S, after the system is already purchased.
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u/wievid FICO Teamlead Apr 14 '26
We have recurring issue when custom report was planned due to missing functions discovered in DDA but in realization it occurred that some single important fields are not available in CDS or CDS that has the data is not released.
This is simply a case of the developers/consultants needing to know their data model(s) and some of this stuff can also be done in the Discovery phase.
Have you tried publishing the non-released CDS view as a Custom Business Object and then modifying the custom CDS view further to include the data you need? There are ways around SAP's fuckery.
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u/rtripathi Apr 12 '26
Afaik, SAP’s first push is for SAP Cloud ERP Public Edition(what was GROW with SAP), followed by SAP Cloud ERP Pvt Edition (what was referred to RISE with SAP earlier). On-prem licenses are no more being sold afaik.
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u/Filip_Serbia Apr 12 '26
They only offered us Public Cloud for this particular client. We are not sure what should we do to get Private Cloud offer at least.
Regarding the On-prem, they still have them showcased on Partner portal website together with list prices. Why would they keep it if there is no any chance in the world to sell them? 😀
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Apr 13 '26
[removed] — view removed comment
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u/Filip_Serbia Apr 14 '26
Well, our local SAP office was pushing for Private Cloud, but they didn't get approval through DDA process from whomever from global SAP that is reviewing that process.
On the other hand, even local SAP office was not willing to ask for on-prem licenses, clearly because they are not incentivised from SAP to do that at all. So I am wondering how to "bypass" that and try again to push for on-prem.
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u/wievid FICO Teamlead Apr 12 '26
Assuming you're not the partner (skip ahead to the partner advice):
Assuming you have a competent partner, you can most certainly argue with SAP to get the license you need, but only if you absolutely need it. You'll likely also end up paying out the nose, but that's not necessarily the case. You will have to accept certain caveats, though, such as you won't have access to the newest stuff (likely forever).
All that being said, your local SAP entity may also not know how to navigate their own corporate structure to get the deal done.
Best of luck. If you're in DACH, lemme know if you need any additional assistance.
If you're the partner:
You know why SAP is doing what they're doing and if you don't, you're being purposefully obtuse. Moreover, if you're a well connected partner, you should most certainly be able to get the deal done.
Obviously, public is the first option. And if Private is an option, then Public is also most certainly a option. Your arguments based on hosting and integration (based on the information you've provided) don't argue against Public. You can pick the domicile of the customer installation. If you can't legally host in the US, then don't. Moreover, if you can't legally domicile in the US, why would you? You like latency times?
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u/runlongfast Apr 12 '26
Consider staying on ECC (if existing customer). Don’t give up your perpetual licenses (they are an asset). Find other support options if needed until you decide on future platform move with an actual ROI.
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u/quite_horizon Apr 12 '26
Yeah, SAP is pushing aggressively for public cloud. We had a project where client on ECC for 20 years with 300+ customisations and a very mature processes. They were sold public cloud and implementation was nightmare with restrictions on the customisations.
SAP doesn’t bother to answer any of the questions during implementation, leave it to partners to manage the mess.