SAP RISE Licensing Models
RISE with SAP is a subscription-based bundle of SAP S/4HANA Cloud and related services, replacing traditional perpetual licensing with a cloud-centric model.
Its unique Full-Use Equivalent (FUE) metric simplifies user counts but requires careful conversion of existing licenses and roles.
CIOs and procurement leaders must understand RISE’s cost structure – including multi-year terms, volume tiers, and bundled extras (like BTP credits and Ariba network access) – to manage total cost of ownership and avoid unexpected charges.
RISE with SAP Overview
RISE with SAP shifts ERP to a cloud service contract. Instead of buying licenses and hosting separately, customers subscribe to SAP S/4HANA Cloud (private or public edition) along with infrastructure and support.
The contract bundles:
- S/4HANA Cloud software (either Private Cloud Edition for full customization or Public Cloud Edition for standardized SaaS).
- Cloud infrastructure & services (SAP or hyperscaler hosting, and SAP-managed updates/ops).
- SAP BTP starter pack (cloud platform credits for extensions).
- SAP Business Network access (e.g., an Ariba Network starter pack with ~2,000 documents).
- Process intelligence tools (e.g., SAP Signavio discovery reports).
- Industry SLAs (uptime guarantees, performance tiers).
This all-in-one approach simplifies vendor management under a single subscription. However, implementation, consulting, and managed support services are not included and must be procured separately through partners. CIOs should view RISE as a subscription ERP platform with built-in services, not a fully turnkey implementation package.
Full-Use Equivalent (FUE) Model
RISE uses Full-Use Equivalents (FUEs) instead of named-user licenses. One FUE represents full access, and lighter user roles count as fractions of an FUE.
Typical conversion factors are:
| SAP User Type | Role Description | FUE Weight |
|---|---|---|
| Advanced Use | Full system access (Professional) | 1.0 FUE |
| Core Use | Limited module access (e.g. limited finance/accounts) | 0.2 FUE |
| Self-Service Use | Basic tasks (e.g. employee self-service) | 0.033 FUE |
| Developer Access | Development or test use | 0.5 FUE |
For example, 5 Core users count as 1 FUE, or 30 Self-Service users count as 1 FUE. This model allows flexibility: you contract for FUEs, not fixed headcounts, and can reassign FUEs among roles without renegotiating.
However, be careful: the minimum purchase is typically high (often ~35 FUE for public cloud, ~40 FUE for private cloud), so even small teams pay a base fee.
CIOs should audit current user roles to translate them accurately into FUEs.
Proper licensing tools or services can reveal savings by eliminating inactive users – one case study cut 227 FUE from a 1,000-user base, saving ~$33K/month..
Read SAP Private Cloud and BTP Credits Under RISE with SAP.
Edition and Pricing Tiers
RISE pricing depends on edition (Private vs Public) and volume. In general, the Private Cloud Edition (dedicated instance) is more expensive than the Public Cloud Edition.
Pricing is usually quoted per FUE per month, with stepped volume tiers. For example, an April 2024 pricing schedule for the private, premium-plus edition showed:
| FUE Volume (users) | Price per FUE (GBP per month) |
|---|---|
| 1–135 | £848 |
| 136–550 | £452 |
| 551–1,000 | £256 |
| 1,001–2,000 | £182 |
| 2,001–4,000 | £116 |
| 4,001–6,000 | £69 |
| 6,001–12,000 | £52 |
| 12,001–25,000 | £44 |
| 25,001+ | £32 |
(Example: at ~1,500 FUE, the private edition cost was ~£182/FUE·mo; the public edition typically runs ~15–20% lower per FUE.) These rates imply heavy users pay far more at small scale, but per-user cost falls sharply as volume grows.
For perspective, one analysis found that a ~1,000-user RISE deal cost about $178 per FUE/month on private edition versus $147/FUE/month on public. CIOs should gather actual SAP quotes or price lists for their tier.
Also note RISE contracts usually require 3+ year commitments, with FUE counts fixed for that term (you can add seats but not easily reduce mid-contract).
Read What Is SAP Private Cloud (Formerly RISE with SAP).
Bundled Services and Inclusions
Beyond core licenses, RISE bundles SAP’s ancillary cloud services.
Key inclusions are:
- SAP Business Technology Platform (BTP) Credits: A prepaid consumption model (CPEA) for cloud services (data/analytics, integration, etc.). Contracts typically include thousands of credits (e.g., 4,000–16,000 BTP credit value for private cloud deals). Additional BTP usage beyond the included quota is charged extra.
- SAP Business Network Starter: Enables collaboration (e.g., Ariba procurement network). Standard RISE deals include ~2,000 Ariba document transactions. Extra documents or advanced network features incur extra fees.
- Business Process Intelligence (BPI): Often includes access to SAP Signavio process mapping tools and a process-discovery report to prepare for migration.
- Service Level Guarantees: E.g., uptime commitments (typically 99.7–99.9% depending on industry) and disaster-recovery terms. Higher SLA tiers (like Premium Plus) cost more.
These “freebies” smooth the transition to the cloud, but their scope is limited.
For example, the included Ariba documents (~2,000) and BTP credits represent a small fraction of what a large organization might use.
CIOs should plan separately for full-feature access to these services beyond the starter packs.
Contract Considerations and Risks
Key contract terms:
RISE is a subscription service. Expect a minimum 3-year term. Contracts often stipulate an initial minimum FUE headcount that cannot be scaled down mid-term.
Payment can be monthly or quarterly, but the deal is negotiated annually. There is typically no price reduction for early termination.
Vendor lock-in:
All infrastructure and updates are SAP-managed. While this offloads ops to SAP/Azure/AWS/etc, it also makes switching providers or on-premise more complex later. SAP has indicated that perpetual license credits will phase down, emphasizing cloud commitment.
Cost structure:
Because RISE is authorization-based rather than usage-based, total costs can exceed on-premise maintenance over time. Analysts note RISE licensing may run 50–150% more expensive than traditional on-prem user licenses.
For example, one study found RISE was cheaper than on-prem only in the first 3 years, but costs rose significantly by year 4. CIOs should run a 5–7 year TCO comparison (including implementation and cloud OPEX) before deciding.
Hidden cost pitfalls:
- License creep: It’s easy to add a user in the cloud – guard against unauthorized accounts and automate deactivations. Over-allocating FUEs means paying for idle seats.
- Digital/Indirect Access: Integrations, APIs, or RPA bots still require licensing under SAP’s digital access rules. Verify that such uses are covered or budget extra FUEs.
- Usage beyond quotas: Monitor BTP and Ariba consumption. Any overage (extra BTP credits, Ariba docs, compute/storage) will be invoiced outside the RISE fee.
Service gaps:
RISE does not include implementation or customization services. Ensure you budget for partners for migration, change management, and ongoing support.
Also, clarify who owns business-critical features: for example, custom extensions must go on BTP (“clean core” strategy). Clarify SLA responsibilities between SAP and any chosen system integrator.
Pricing and Contract Examples
Below is a sample pricing structure to illustrate RISE costs:
| FUE Band (Users) | Private Cloud (Premium) | Public Cloud (Standard) |
|---|---|---|
| 1 – 135 | ~£848 per FUE·month | ~£700 per FUE·month |
| 136 – 550 | ~£452 | ~£370 |
| 551 – 1,000 | ~£256 | ~£210 |
| 1,001 – 2,000 | ~£182 | ~£150 |
| 2,001 – 4,000 | ~£116 | ~£95 |
| 4,001+ | ~£69 ↓ | ~£60 ↓ |
(Illustrative rates from public pricing data; actual quotes may vary by region and deal.)
Example: A company converting a 1,000-user on-prem SAP system might enter RISE at roughly 1,000 FUE. In published examples, the cost is about $147 per FUE per month on the public cloud (versus $178 on private), or roughly $147,000 per month.
If 230 fewer FUEs were needed (through role optimization), it would save ~$33,000 per month. These figures highlight why precise FUE sizing and role review are critical before signing.
Below is a summary of common RISE license issues and their impact:
| Risk | Impact |
|---|---|
| Minimum Commitment | RISE requires multi-year, fixed-seat commitments (often ≥35 FUE). Unable to reduce headcount mid-term. |
| High Per-Seat Cost | Small deals pay a premium. FUE pricing can be 50–150% above legacy license costsusu.com, inflating OPEX. |
| Unused Entitlements | Without controls, dormant accounts and unclaimed BTP/Ariba allowances waste money. |
| Digital Access Liability | Indirect usage (e.g. via middleware or bots) may fall outside the bundled license, leading to audit exposure. |
| Vendor Lock-in | SAP controls infrastructure and core ERP upgrades. Exiting RISE often means significant rework or costs. |
| Excluded Services | Implementation, integration, and custom development are separate costs (SAP partners/consultants must be hired). |
CIOs should treat these as negotiation points and operational checks.
Recommendations
- Audit Before You Sign: Perform a thorough license and usage audit of your current SAP environment. Map existing user roles to RISE FUEs to avoid overbuying.
- Negotiate Pricing Tiers: Shop around or work with SAP partners to get competitive FUE pricing. Larger deals command better per-FUE rates. Compare private vs. public edition costs and features.
- Capitalize on Bundles: Leverage the included BTP credits and Ariba docs, but don’t rely on them exclusively. If heavy BTP or network usage is expected, negotiate additional credits or factor in extra spend.
- Clarify Contract Terms: Insist on transparency around minimum FUE, renewal terms, and exit clauses. See if SAP will allow any flexibility (e.g. 5% annual adjustment) or put a cap on price escalations.
- Monitor Usage Continuously: Establish internal processes (or use tools) to track FUE consumption, digital access counts, and BTP usage. Conduct quarterly or semi-annual license true-ups.
- Control License Creep: Put change controls around adding users or devices. Disable inactive accounts quickly. RISE’s flexibility can also be a trap if uncontrolled growth slips under the radar.
- Plan Total Cost of Ownership: Factor in long-term subscription costs, plus migration and support fees. Model 5-7 year TCO versus alternatives (e.g., on-prem or different cloud ERP).
- Engage Expertise: In complex deals, use SAP-specialized legal and licensing advisors to review terms. They can reveal favorable clauses (e.g., SAP credits for on-prem conversions) and benchmark pricing.
- Keep a Flexible Architecture: Adopt the “clean core” approach: minimize on-prem-style customizations in S/4HANA and use BTP or partner solutions. This reduces upgrade complexity and avoids hidden license requirements.
- Stay Informed: SAP’s offerings evolve (e.g., new GROW packages, updated FUE rules). Maintain an active dialogue with SAP reps or third-party analysts to catch changes or incentives (like credits for early renewal).
By applying these recommendations, CIOs and procurement leaders can turn SAP RISE from a cost risk into a manageable cloud strategy.
Read about our Rise with SAP Advisory Service.
