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.