Unwary SAP private cloud users face 10% renewal hikes, warns Gartner

Gartner has reported that SAP customers opting for private cloud have seen price increases of 10 percent or more on renewal proposals if they fail to negotiate a renewal price cap in the original deal.

SAP ramped up efforts to move customers to its latest software in the cloud on a subscription model nearly five years ago and has shifted its sales teams' incentives to encourage sales of SAP Cloud ERP Private subscriptions, but a recent paper from the global IT researchers shows the move has not been without commercial challenges.

Meanwhile, SAP's on-prem customers can still negotiate discounts, although this is becoming more challenging. Gartner said it expects SAP's on-premises customers to face annual support price increases for the foreseeable future as the ERP vendor tries to persuade customers to move to the cloud.

In a situation that includes discounts and commercial penalties for cloud and on-prem ...