EU concessions give SAP customers leverage on support contracts, Gartner says

SAP customers have new bargaining power after the European Commission closed an antitrust probe into the company’s maintenance and support practices, Gartner said in two research notes. The German software vendor agreed to scrap reinstatement fees, cut back-maintenance charges and clarify customers’ ability to combine SAP and third-party support, changes that matter for large enterprises facing expensive ERP migrations.

The Commission ended its investigation after accepting SAP’s commitments on maintenance and support services in Europe. The case had examined whether SAP’s policies limited competition in the aftermarket for support, a critical spend category for companies running SAP systems at scale.

Gartner’s view is that enterprise application leaders should use the decision to revisit ERP modernization schedules and contract talks with SAP. The firm said customers should put less weight on vendor-imposed timelines and more weight on technical debt, operating model readiness and the need for new ERP capabilities.

The timing is commercially sensitive for SAP. Thousands of large companies still run core processes on SAP ERP Central Component, or ECC. SAP’s mainstream support for ECC is scheduled to end in December 2027. Customers can buy extended maintenance through December 2030, but must pay an additional two percentage points on maintenance fees.

SAP has also been steering customers toward cloud and SaaS through RISE with SAP, the migration program it introduced in early 2021 with cloud providers and third-party service vendors. Gartner estimates that most of SAP’s installed base remains on-premises. The firm also said that by 2030, more than 10,000 SAP customers will still use ECC-based systems for significant parts of their business.

In one Gartner paper, the firm said the Commission’s decision gives customers more room to use third-party software support as a way to reduce migration risk, rather than treating it only as a cost reduction tactic. Gartner warned that moving too early can create technical debt and higher costs, and said customers should use the added flexibility to avoid cloud commitments before they are ready.

SAP had said in its October response to the Commission’s investigation that it would improve the economics for customers that want to return to SAP maintenance and support. The Commission said SAP has now committed to remove reinstatement fees and lower back-maintenance fees for customers that come back after a period outside SAP support.

The company also agreed to clarify the terms under which customers can use different maintenance and support providers, as well as different levels of SAP support. Gartner said that change can strengthen the hand of ECC and on-premises S/4HANA customers in both support renewals and cloud negotiations. The firm advised customers to cite the Commission decision when challenging standard maintenance increases.

SAP user groups were more cautious about how much behavior will change. Michael Bloch, a licensing expert and board member at German-speaking user group DSAG, told The Register that many ECC customers considering third-party support may not later return to SAP. He also said he does not expect S/4HANA customers to cancel support and rejoin later, given S/4HANA support runs until 2040.

Conor Riordan, chair of the UK & Ireland SAP User Group, told The Register that users have long wanted more flexibility, transparency and predictability. He said the commitments should give customers a clearer framework for adapting their SAP estates to business needs, but added that the group does not expect a broad move away from SAP maintenance. For complex or business-critical SAP environments, he said extended maintenance remains the lower-risk bridge while transition planning continues.

This story draws on original reporting from The Register.