To some observers, SAP’s February launch of the next-generation SAP S/4HANA software suite seemed a bit rushed, with a number of key details either lacking or communicated in a scattershot manner.

But to its credit, SAP was quick to answer the follow-up questions posed by customers, media and analysts. And now, the company has published a voluminous official FAQ document that fills in even more of the blanks on a wide array of S4HANA topics.

We’ll be breaking down SAP’s monster FAQ in a series of posts on ASUG News, including this one, which focuses on pricing.

What is SAP S/4HANA’s pricing model?

Veteran SAP customers will not be surprised to learn that it’s a touch complicated. Per the FAQ:

“For the on-premise version, SAP Business Suite customers need to purchase the SAP S/4HANA foundation-promotion license to run the new SAP S/4HANA code line.”

OK, so what’s a foundation-promotion license? The FAQ doesn’t make that clear, so I reached out to SAP for clarification.

"The SAP S/4HANA foundation license entitles the customer to use SAP S/4HANA and it is more a license key,” an SAP spokeswoman says via email.

To move to SAP S/4HANA, “on-premise customers need to move their Business Suite to SAP HANA and then implement the latest exchange innovation package which brings the new SAP S/4HANA coding,” she adds. “These packages can only be installed by customers having licensed the SAP S/4HANA foundation."

There is some good news for early movers, though. While SAP S/4HANA requires Business Suite customers to buy a SAP HANA runtime license, if they do so before the end of the third quarter of this year, SAP will throw in the foundation-promotion license at no additional charge, according to the FAQ.

The same goes for any Business Suite on HANA customers, since they already have the SAP HANA runtime license.

What about cloud deployments?

Unfortunately, the FAQ comes up short on this crucial question:

“For the cloud, the pricing model will be subscription-based and communicated at a later stage. Please contact your local sales representative for more information.”

It’s not clear why SAP isn’t yet releasing information cloud pricing model, especially given that its HANA Enterprise Cloud service was announced in May 2013.

One possible reason SAP may be the partnership it announced in October with IBM. Under the deal, HEC’s global footprint will be greatly expanded with additional availability in IBM’s many data centers around the world.

It could be that the companies haven’t agreed on all the details of pricing and revenue sharing for SAP S/4HANA customers serviced on IBM’s cloud. In any event, more details of SAP S/4HANA cloud pricing could emerge at SAPPHIRE NOW and ASUG Annual Conference in May.

Will SAP’s cloud apps such as SAP SuccessFactors and SAP Concur be merged into SAP S/4HANA?

Integrated, yes. Merged, no—at least not with respect to cost. We go to the FAQ:

“SAP S/4HANA is planned to integrate with our existing cloud portfolio offerings. These offerings remain offered under separate license/subscription.”

This may not be altogether surprising. But given that SAP SuccessFactors is to serve as the default application for payroll and HCM in SAP S/4HANA era, customers will presumably be able to drop maintenance payments for their on-premise HCM software and trade up for SAP SuccessFactors licenses, under the terms of a program SAP announced in 2013.