Managing HANA License Costs
SAP HANA is a powerful but expensive technology, so controlling its licensing costs is a top priority for many organizations. Fortunately, several strategies exist to keep HANA costs in check. Read our SAP HANA licensing guide.
These include optimizing the data you keep in memory (so you don’t pay for capacity you don’t need), leveraging technical features to reduce the memory or hardware required, and considering alternative licensing models (such as cloud or pay-as-you-go) that align costs more closely with actual usage.
This article outlines practical ways to manage and reduce SAP HANA license costs while still getting HANA’s performance benefits.
Optimize In-Memory Data Usage
The biggest factor in HANA licensing cost is the volume of data kept in memory, since on-premise HANA licenses are typically based on memory size.
One of the most effective cost management techniques is to minimize the data footprint of your HANA system:
- Data Archiving: Regularly move historical or infrequently accessed data from HANA to more cost-effective storage. Archive old transaction records or log data to external storage. This frees up expensive HANA memory and lowers your required HANA license size. Set retention rules (e.g., archive data older than 5 years) to minimize the in-memory footprint.
- Data Aging and Tiering: SAP HANA features such as Native Storage Extension (NSE) and data aging enable you to store “warm” data on disk or slower memory, rather than in main memory. You can greatly shrink HANA’s in-memory footprint by offloading up to 80% of your data to warm storage with NSE. This translates to lower license costs since HANA is tied to in-memory GB. The strategy is simple: keep only hot, frequently used data in RAM, and let warm/cold data reside on disk (with minimal performance impact).
Read Licensing HANA for Non-SAP Applications.
Leverage Cost-Saving Technologies
Beyond data management, there are technical approaches to reduce HANA infrastructure costs:
- Right-Size Hardware: Ensure the hardware provisioning for HANA isn’t massively overkill for the workload. If your HANA appliance has significantly more RAM than your data requires (e.g., 2 TB installed but only 1 TB used), you’re over-licensing. You could scale down to a smaller appliance or use scale-out architecture with multiple smaller servers, whichever yields lower licensing and hardware costs.
- Use Cheaper Editions if Possible: Ensure you’re not over-licensed regarding HANA edition. If you only use HANA to support SAP’s applications, stick with the HANA runtime license rather than full-use – the cost difference is significant. Likewise, if you don’t need all the extra features of HANA Enterprise Edition, consider sticking to the Standard Edition and adding optional components only as necessary. Tailor the license to your specific usage to avoid paying for unused capabilities.
Consider Cloud and Flexible Licensing
Another way to manage HANA costs is to move to more flexible consumption models:
- SAP HANA Cloud: Instead of running HANA on-premise with a big upfront license, SAP HANA Cloud offers a cloud-based database-as-a-service where you pay as you go. It offers subscription (fixed) or pay-as-you-go plans, allowing you to scale up or down and pay only for what you use. This can be cost-effective for variable or smaller workloads. (It also eliminates on-prem hardware costs.) Over the long term, a subscription may exceed on-premises costs, but the flexibility to turn off or shrink instances (for example, shutting down test systems on weekends) can yield significant savings.
Ongoing Governance and Monitoring
Even after implementing optimizations, maintain discipline in how HANA is used:
- Monitor Usage and Growth: Track the amount of licensed memory in use. Set up alerts to notify you when you approach your license limits, helping you avoid compliance surprises. Regular usage reviews can reveal if you are over-licensed (and could potentially reduce the license at renewal) or if usage is growing faster than expected (prompting early action before hitting limits).
- Eliminate Waste and Educate Teams: Decommission any unused HANA instances or capacity to stop paying maintenance. For example, remove that system from your support contract if a HANA project is canceled. Also, IT and finance teams should be educated about HANA’s licensing model to consider cost implications before loading massive new datasets or spinning up additional HANA systems. Building cost awareness into operations helps keep HANA expenses under control as your environment evolves.
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