Service Provider Cloud

SAP Debuts a Buffet-Style Cloud Plan

BARCELONA -- Mobile World Congress -- SAP introduced a buffet-style cloud pricing plan Monday, allowing enterprises to consume any SAP cloud services for one price, complementing the company's existing à la carte pricing.

Rather than subscribing to individual cloud services separately, and attempting to project how much of each service they need, enterprises can subscribe to all services on SAP Cloud Platform for one price.

The new "consumption-based commercial model" allows SAP customers to buy "cloud credits" to activate SAP Cloud Platform services, Dan Lahl, VP of product marketing for SAP Cloud Platform, tells Enterprise Cloud News. Users can also track usage for each service, with metering, reporting and detailed accounting analytics. The new consumption model helps users to get new applications online quickly.

"It's almost like buying a gift card," Lahl says -- buy a CostCo gift card, and you can use it for anything you want at CostCo.

Photo by By Vladislav Bezrukov from Walldorf, Germany [CC BY 2.0], via Wikimedia Commons
Photo by By Vladislav Bezrukov from Walldorf, Germany [CC BY 2.0], via Wikimedia Commons

Want to read the hot news and views from Mobile World Congress 2018? Check out our dedicated MWC 2018 news section to keep up to date with the key developments from Barcelona.

The SAP announcement "seems like a direct reaction" to Amazon Web Services Inc. and Oracle Corp. (Nasdaq: ORCL), Ovum Ltd. analyst Mike Sapien tells Enterprise Cloud News. "Both AWS and Oracle now have some form of consumption-based cloud pricing."

Oracle introduced Universal Credits, a single contract for all existing and future infrastructure and platform services (IaaS and PaaS), in September. That's essentially the same as what SAP is introducing today. (See Oracle's Ellison: We'll Beat Amazon Cloud Pricing by Half.)

In addition to credits, Oracle also provides Bring Your Own License for IaaS, allowing users to re-use existing licenses for Oracle on-premises software and apply those to IaaS and PaaS.

Oracle and SAP both face pressure to compete with AWS on price and in simplifying pricing models that confuse customers, Sapien says.

AWS has recently promoted its integration and professional services for SAP, "which has to be putting pressure on SAP to respond," Sapiens says.

AWS last year reduced the time increments for charges for use of Elastic Compute Cloud, Elastic Block Store storage, as well as Amazon EMR, which runs big data frameworks such as Hadoop and Spark. Users can buy blocks of time in one-minute increments. That doesn't do anything to reduce complexity, but it does give users finer-grained control of costs. (See Cisco: Enterprises Will 'Spend Differently'.)

Additionally on Monday, SAP enhanced SAP Cloud Platform SDK for iOS, for developing apps on Apple iPhones and iPads. The new SDK has tighter integration with Apple's Xcode integrated development environment, the standard for developing iOS apps. Developers can now access SAP API Business Hub, which allows users to utilize mobile apps for functions such as approving new hires or purchase orders.

The iOS SDK supports SAP Cloud Platform Translation Hub to translate applications between languages like English to Spanish. New analytic controls enable real-time data analytics and visualizations within mobile apps from SAP S/4HANA, SAP Big Data Services and SAP HANA. Also, apps can use iOS device capabilities for administrative tasks, such as on-boarding new users.

SAP introduced two new iOS mobile applications: SAP Insurance Sales Assistant enables insurance agents to effectively manage all sales activities and SAP Asset Manager is an IoT platform for managing work orders, notifications, condition monitoring, material consumption, time management and failure analysis, SAP says.

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— Mitch Wagner Follow me on Twitter Visit my LinkedIn profile Visit my blog Follow me on Facebook Editor, Enterprise Cloud News

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kq4ym 3/14/2018 | 2:41:38 PM
Re: Pricing clarity It's a tricky business for consumers, when the rules aren't known or they need a lawyer to interpret. But, businesses manage to pick up some easy proits with the sale of those cards.
mhhfive 3/8/2018 | 6:13:27 PM
Re: Pricing clarity This gift card discussion reminded me that I was surprised that I once spent more than the value of a Visa gift card. I didn't think it was possible, but apparently, if you charge something on a gift card -- and the amount is variable -- then the merchant charges its "best guess" as to what you spent, but Visa will still allow you to spend the rest of the balance of the gift card. However, if that "best guess" is low.. then you can exceed the value of the card. 

For example, I used part of a Visa gift card to pay for a restaurant bill.. and left a tip using the gift card, too. The restaurant's "best guess" didn't include my tip, so I used up the rest of the balance, but when I checked the gift card balance later -- it appeared that the tip charge went through (phew), but Visa had already authorized my remaining purchases, and the total was more than the gift card was originally worth. I assume Visa will get wise to that loophole someday? (Or some unfortunate waiter won't get his/her tip....)
mhhfive 3/8/2018 | 5:56:56 PM
Re: Pricing clarity I've found that those pre-paid VISA gift cards can be turned into more useful gift cards. As long as the gift card doesn't have to be spent at a certain store, like ToysRUs or Starbucks or whatever, you should be able to buy Amazon gift cards with a VISA gift card (for any amount over $1). Then you can use those leftover funds for anything Amazon sells (which is nearly everything). 

But nothing beats cash. Gift cards are usually just a pain.

Susan Fourtané 3/6/2018 | 2:31:48 AM
Re: Pricing clarity Michelle: That’s awful and disappointing. It’s also unfair that they took back your balance due to inactivity. It sounds like a way of pushing people to use the gift cards in a certain period of time of they punish them. They can’t give a gift and take it back. Or they shouldn’t. Coffee Shop could have given you something little at least as well just to help with the disappointment. It wouldn’t have cost them too much and they could have made you a little happier.
Susan Fourtané 3/6/2018 | 2:18:46 AM
Re: Pricing clarity Maryam: It’s a great idea to donate the unused or unwanted gift cards. I never thought about it even if it sounds so simple and logical. Thank you for the idea!
Joe Stanganelli 3/2/2018 | 5:21:22 AM
Re: Pricing clarity @Michelle: Wow. That does sound heartbreaking.

This discussion has been really eye-opening. I was unaware of this. (As an attorney, I have more than enough fine print to read in my life than worrying about a few dollars on a gift card.) I'll pay attention to this in the future -- and tell people to skip the gift cards next Christmas. ;)
Joe Stanganelli 3/2/2018 | 5:19:48 AM
Re: Pricing clarity @maryam: The Visa cards lose value every month? That sounds...strange to me. I feel like I've gone a while without using my gift cards and not had a problem.
Ariella 3/1/2018 | 9:04:51 PM
Re: Pricing clarity @Joe Yes, that's just the kind of thing that makes gift certificates and cards more lucrative than they appear on the surface; they bring in money for the business at no real cost when they're not cashed. When they are cashed, they also can bring in more business. For example, say the certificate you have is good for $50. You'd seek to spend all of it because you won't get any change back, and in making sure you get full value, you would likely go up at least a bit becaues total amounts often don't work out perfectly evenly. Then they gain more of a sale on top of the orignal price paid. Multiply that effect by many gifts, and you increase returns.
Michelle 3/1/2018 | 2:48:12 PM
Re: Pricing clarity Read the fine print!! :) I have seen this on Visa and Mastercard branded gift cards. Store cards don't seem to do this awful thing. I lost $8 to these service fees once. It was heartbreaking. I wanted to buy coffee shop breakfast with my remaining balance, but I couldn't because it had been taken back due to inactivity. 
[email protected] 2/28/2018 | 11:05:18 PM
Re: Pricing clarity Joe an idea for that gift card if you don't want it to donate it! Many worthy causes will give it to a hungry family or use it to get take out for someone that is ill or homebound. Play it forward someone in need can use it!
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