FAQ on consumption-based commercial model for SAP Cloud Platform

[ralf_schaub]

Still not clear on what the new consumption-based license model brings for SAP Cloud Platform?Here is an FAQ document that gives you answers to most of the aspects around the new model.

This blog post references a (living) document with questions and answers around the new model. The model itself comprises of the Cloud Platform Enterprise Agreement (CPEA) and so called Cloud Credits the customer can purchase.

The following sections have been created to ease the structure of the FAQs:

• General Commercial Model


• Services Scope and Handling


• Contract and Market Scope

Please see, bookmark and revisit the document as it outlines relevant information. Remember, we have just started the journey...

Here is the link: FAQ Document

As we want to improve the document, please feel free to post your comments and questions, that may not be answered in the FAQ yet. We are more than happy to include them.

 

[fred_verheul]

Hi Ralf,

I'm just now (triggered by SAPPHIRE) reading up on this CPEA and Cloud Credits stuff. It seems like an improvement over the previous (well, earlier introduced) subscription-based model. But after reading the FAQ I still have some questions:

1. For a consumption-based model, which is what this seems to be about, it still feels enterprisey (ie there is a perceived lack of flexibility) compared with how companies like Amazon and Google define consumption-based: is the minimal contract period indeed 1 year? And if you purchase too much, it will be gone at the end of the year? That doesn't sound very consumption-based to me...


2. In the same vein: customers can decide, based on the estimator (thanks for that!) how many cloud credits they want to purchase, but there seems to be a minimum threshold. Can you indicate what this threshold is (as in: how much money)? Doesn't need to be very precise, but should give an idea of the investment a customer has to be willing to make upfront (which is, to reiterate, not very cloud-like IMO).


3. Since it's now a couple of months later: what are the initial experiences w customers? Are they generally happy about this model, especially compared with the subscription-based model?


4. Specifically: are there customers who don't want to make this upfront investment? Is this minimum threshold negotiable?


5. Are there already additional markets added to the mix? (Apart from the 5 initial countries).

Maybe I will come up with more questions, but this should do for now ;-). Thanks for providing additional clarity on this new commercial offering!

BR, Fred

[fred_verheul]

Hi Ralf,

And here is another thought/question: given that unused credits magically disappear after the prepaid period, I'd expect customers to err on the lower side when purchasing their initial prepaid credits. So, what if during that first period the customer sees that total spend is actually more than projected (and would, when extrapolated, be more than the current cloud credits allow for)? In the FAQ it says: overage is billed per the list price. But is it also possible to buy additional cloud credits mid-term? And how would that work with regards to contract period (is this even a new contract, or just another order within the existing contract?)?

Also: list price seems like it could be more expensive than using cloud credits. Is that generally true? Or is there no difference at all? In which case the question becomes: why purchase more (prepaid!) than that minimum threshold?

Thanks again for the clarification, Fred