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ERP Software License Types

If you read my October blog titled “What is the Cloud?” you may have learned what a definition of “the cloud” is. If you missed it, you can view that blog here.

Some ERP software publishers classify that they “are in the cloud.”  Some also say they have on-premise licenses; and some refer to them other ways. Some software publishers offer several different license types. Let’s dive in a little deeper into this subject.

We will use SAP Business One ERP software in our example and provide you with the different options SAP Business One can be “purchased”:

1. Perpetual licenses: There is a one-time purchase of the licenses and then an annual software maintenance fee which is usually a percentage of the software price and covers things like the rights to future releases and patches, bug fixes, etc. There are sometimes other levels of software maintenance that may be provided including more options that may include some level of phone or email support, access to training videos, and training document libraries.

Perpetual licenses can be purchased and installed on your own servers (your location(s) or the cloud).

2. Subscription Licenses: Subscription licenses are licenses that are “purchased” with a fee generally based on a month or year with a contract duration. In this example, the subscription fee goes on “forever” assuming that you continue to extend your contracts. For those that use Office 365, these are subscription licenses that in theory, you will pay “forever.”

Subscription licenses are purchased and installed in the cloud. If you are considering purchasing SAP Business One ERP you can purchase the subscription licenses and they can be installed on an approved provider server in the cloud. Examples of these are:

  • SAP Cloud
  • Partner Cloud
  • 3rd party cloud such as SkyOne

We do not force you to purchase your ERP software one way. SAP offers SAP Business One in all “flavors”:

  • Perpetual Licenses installed on your server(s) in your facility
  • Perpetual licenses installed in the cloud (server facility, partner, AWS, Azure, etc)
  • Subscription Licenses installed on SAP cloud
  • Subscription Licenses installed on approved SAP partner cloud
  • Subscription licenses installed on approved 3rd party cloud (AWS, Azure, etc)

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