SAP Hana Memory-Based Licensing and Sizing
SAP HANA’s licensing model for on-premises deployments is closely tied to the amount of memory (RAM) used by the database. In simple terms, the more in-memory data your HANA system holds, the higher your licensing costs.
For IT decision-makers, it’s crucial to understand how memory usage drives HANA costs and adopt smart sizing strategies. Read our SAP HANA licensing guide.
You can control license costs without sacrificing performance by carefully sizing your HANA environment and managing data.
Memory-Based Licensing Explained
Unlike many traditional databases, which are licensed per processor or user, SAP HANA on-premise is typically licensed based on the amount of memory you plan to use.
Notably, you could have more physical RAM installed than you’ve licensed; however, HANA can be configured to use only the amount of memory you’ve paid for.
If your data footprint grows, you must purchase additional GBs of license to accommodate it.
Because memory is the metric, efficient use of HANA’s memory is financially important.
If a HANA system is oversized (licensed for far more memory than needed), you are paying for idle capacity.
If it is undersized, you risk performance issues or an urgent need to buy more licenses if usage exceeds the entitlement.
HANA’s columnar compression further helps reduce the memory required: the achieved compression ratio can be around 4:1, meaning 1 TB of raw data might only consume ~250 GB in HANA memory.
Effective data management and compression ensure you don’t pay for more memory than necessary.
Read SAP HANA Runtime vs. Full-Use License.
Sizing Strategies to Control Costs
To optimize HANA licensing and avoid overspending, organizations should employ several strategies:
- Right-Sizing the Environment: Utilize SAP’s sizing tools (e.g., Quick Sizer) to estimate the required HANA memory, and license only what you need, with a small safety buffer. Avoid significantly over-licensing “just in case,” as unused capacity still incurs cost. Revisit your sizing after deployment to adjust for actual usage. For example, if only 500 GB of a 1 TB license is utilized, you might scale down the license at renewal or deploy additional workloads on that unused memory.
- Data Tiering: Not all data must reside in expensive HANA memory (hot tier) at all times. SAP HANA supports tiered storage options, enabling you to keep only active, high-value data in memory and offload less frequently used data to lower-cost tiers. For instance, HANA’s Native Storage Extension (NSE) or extension nodes can hold warm data on disk. You sustain performance while cutting costs by keeping actively used data hot and migrating less-used data to warm or cold tiers. Implement data aging or use solutions like SAP Data Lake to store older data. This way, your HANA in-memory footprint (and corresponding license) remains as small as practical.
- Archiving Unused Data: Maintain a strong data archiving policy. Data no longer needed in daily operations (such as completed orders from a decade ago or closed financial periods) should be periodically archived from HANA. You can retain it in a less expensive system or storage for compliance, but removing it from HANA frees up memory. This directly reduces your licensed memory needs – a smaller HANA database means a smaller license cost. SAP data archiving tools or third-party solutions can automate this process, allowing HANA memory usage to plateau rather than grow indefinitely.
- Setting Memory Limits: Enforce your license limits within the system. HANA provides a configuration for global memory allocation that you can set to the licensed amount. You avoid accidental overuse by capping HANA’s usage to what you’ve paid for. Monitoring tools can alert you as you approach the cap, allowing you to archive data or purchase more capacity proactively. Many administrators set the allocation limit slightly below the license to provide a safety margin.
Read Licensing HANA for Non-SAP Applications.
Recommendations
Optimize Before Expanding:
Before purchasing additional HANA memory capacity, explore potential optimizations to maximize efficiency. Archiving or optimizing data can often defer or reduce the need for additional licenses. A clean-up project can often save costs by freeing enough memory to avoid a license increase.
Utilize Tiered Storage:
Leverage HANA’s capabilities for handling warm and cold data. Keep your primary working set in memory and move the rest to cheaper storage (disk or cloud). This can dramatically reduce license requirements while keeping data available when needed (with a slight performance trade-off for older data).
Plan for Growth: Include growth projections in your sizing plan, but consider licensing in phases – acquire what you need now and scale up later as needed. Large expansions can be timed with contract renewals or negotiations to seek better pricing tiers for bulk memory.
Monitor Memory Usage:
Track your HANA memory usage versus your licensed amount. If you consistently use far less than your licensed capacity, you may adjust your license at renewal (or at least avoid over-provisioning new systems). If you’re nearing the limit, you can take action (such as cleaning up data or budgeting for more licenses) before it becomes urgent.
Balance Performance and Cost:
Collaborate with your business stakeholders to strike the optimal balance between performance and cost. For example, consider keeping the last two years of data in memory and archiving older records. Align your data retention requirements with what you’re willing to pay for in-memory performance to satisfy IT and finance.
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