Introduction to the SAP public cloud: what it is, for whom and how much it costs – using the example of changes in the film industry
February 2026 | Reading time: 6 min
In the latest episode of GRC Ninja, we look at one of the most interesting topics in the SAP ecosystem in recent years – the SAP Public Cloud model. Together with Rafal, an experienced SAP consultant specializing in authorization and configuration of cloud systems, we explain the issue in an accessible way, without the typical SAP jargon.
To better illustrate this paradigm shift, we reached for an analogy that everyone is familiar with – the revolution that Netflix caused in the movie industry.
What is SAP Public Cloud?
SAP Public Cloud is a ready-made, fully managed SAP ERP system running in the cloud. The customer doesn’t install it on its own, doesn’t buy servers, doesn’t worry about updates or backups – it’s all up to SAP. The company simply subscribes to the service and configures it within the available options.
It’s a bit like how Netflix changed the entire movie industry. We used to run to the rental store to get VHS tapes, today we turn on the TV and watch what we want. In the cloud, you don’t own the system – you just use it. It’s a paradigm shift in thinking.
Instead of building and maintaining its own server room, hiring IT administrators and installing software, the company buys access to the system – exactly as it buys a subscription to a streaming service. SAP provides the infrastructure, upgrades and security, and the customer simply benefits.
Who is SAP Public Cloud for?
SAP Public Cloud customers can be divided into three main groups:
- Medium-sized companies – want to take off quickly, without an extensive IT department, are growing rapidly and do not want IT systems to be a barrier to growth.
- Subsidiaries in large groups (Greenfield projects) – need a quick start as standard, without building a solution from scratch.
- Large organizations – implement Public Cloud in selected areas (e.g., purchasing, controlling in subsidiaries), while the main system remains on-premise or in private cloud.
Often it is a hybrid model – the main system still runs on-premise or in the private cloud, and only selected processes are moved to the public cloud. This allows you to combine stability with flexibility.
Pros and limitations
The biggest advantage of SAP Public Cloud is standardization and speed of implementation. The system offers ready-made, tested business processes that can be configured within the available options. The customer does not need to invest in infrastructure or a dedicated team of administrators.
However, standardization comes at a price – customization possibilities are limited. Unlike classic on-premise, you can’t freely modify the code or create your own transactions. Extensions are possible, but within the framework of defined extension points and available APIs.
Is Public Cloud for your business?
Quick decision test – if you answer “yes” to most of the questions, SAP Public Cloud is worth considering:
- Can 80% of processes be handled as standard?
- Is a short implementation time crucial?
- Do we care about low TCO and predictable costs?
- Will the company culture accept standard solutions?
- Can the integration be built within the available APIs and extensions?
However, if you have often answered “no,” it is better to stay in the private cloud or on-premise model. As we emphasize in the episode: the cloud is not a fad – it’s a conscious choice of operating model.
PUPM licensing model – how much does it cost?
In the traditional SAP model, you bought a one-time license, paid for maintenance and had the system on your own. In the cloud – like Netflix – you pay a subscription for access.
SAP has introduced the PUPM (Per User Per Month) model, which is the successor to the earlier FUE model. This means a monthly fee per user. This price includes infrastructure, upgrades, technical support and the right to use the software.
Key mechanism: business directories
SAP Public Cloud has so-called business catalogs – collections of applications and functions. Each catalog is assigned a license category: self-service, operational, finance base, finance premium, developer.
The system works on a “highest type wins” basis – if an employee has access to several directories, he will be assigned to the most expensive one. One excess access can drive up the cost of licenses for an entire group of users.
This means that the PUPM model is simple in communication, but requires great precision in practice. The system doesn’t look at who actually uses a given application, but at who has what permissions. You pay for potential, not actual use.
Example from practice
Manufacturing company, 100 users. Most need basic self-service access. Only a few employees actually require finance premium licenses. But if the roles are defined too broadly, suddenly half of the production crew costs as much as the finance directors.
Therefore, licensing workshops and conscious role design are key. Companies should know which directories are assigned to more expensive packages and avoid accidental access. Unfortunately, as we note in the episode, this is not knowledge that SAP is willing to share.
Beware of contractual restrictions
The PUPM model gives flexibility, but only one way. Licenses can easily be added during the contract, but cannot be reduced until the contract is renewed. Contracts are usually signed for 3 or 5 years – if a company overestimates its needs and buys too many premium licenses, it pays for them until the end of the contract.
Therefore, planning with a margin of reason and constant monitoring is key – you need to regularly check who is actually using the system and how.
How to control costs?
It’s not enough to buy an SAP Public Cloud license and tick off the topic. Every catalog is a cost, and the right tools help you realistically control who has access and how much the company actually pays. Among the most important are:
- SAP GRC – risk, compliance and entitlement management
- SAP IAG (Identity Access Governance) – control of access and identity life cycle
- smartGRC – automation of audit and monitoring roles
PUPM is Netflix’s ERP-a subscription that’s simple in theory, but if you don’t know what you’ll be watching, you’ll quickly find that you’re paying for four premium accounts, even though you’re only watching two series a month.
Summary
SAP Public Cloud is changing the way companies use ERP systems – exactly as Netflix changed the movie industry. In the cloud, you pay not for hardware, but for access, so it pays to know who you’re really giving it to.
This was the first of two episodes on SAP Public Cloud. In the next one we’ll get down to specifics – we’ll show the authorization model, a live demo of the system, spaces and pages, and how to avoid mistakes in configuration.
Do you need SAP Public Cloud support?
GRC Advisory helps companies consciously manage roles, permissions and licenses in SAP Public Cloud. We offer licensing workshops, entitlement audits and GRC tool implementations.
Contact us – we can help you optimize costs and secure your SAP environment.
Source: GRC Ninja episode – “SAP Public Cloud”.
