With plans to drop regular maintenance of four R/3 versions late this year, SAP AG wants its local customers to upgrade to its latest R/3 apps.

While SAP will continue to provide limited technical support for the R/3 versions including 3.11, 4.0B, 4.5B and 4.6B, customers with versions older than the R/3 4.6C product will have to buy a year of service for an additional 2 per cent maintenance fee if they do not upgrade.

SAP's Australia and New Zealand global support director, Greg Pike, said support will be limited for customers with the older R/3 versions and will not include new support packages or interfaces.

Pike said no customers have yet taken the additional year-of-service option, but said it may be on the cards for some customers.

He said there are about 450 customers in Australia using R/3 business applications, the bulk of which have already upgraded or are currently upgrading.

"About 130 local customers are affected by the maintenance changes and are still using the older R/3 versions or still planning an upgrade," Pike said.

Greater Asian region manager of the ERP program office at Kodak, David Lindill, said his organisation is using one of the older versions, R/3 3.11, until December 2003.

Lindill said Kodak has invested a significant portion of its corporate annual IT spend of $US500 million in SAP offerings and is undertaking a global upgrade from R/3.1I to R/3 Enterprise to deliver mysap.com functionalities in e-commerce and CRM.

"We will run out of full support for 3.1I from December 2003 for a few months until the upgrade goes live in February 2004. We've been working with SAP to make sure we maintain full support through that period of upgrade," he said.

Lindill said Kodak has one system globally, with an enterprise licence covering an estimated 14,000 users.

He said companies that invest in packaged software solutions have to have an upgrade strategy. "If you don't it's a problem you have to deal with at some point.

"When laying out the budget for IT, upgrades are a necessary part of it. We do upgrades all the time in Sun Solaris, Oracle and so on, it's just that this SAP upgrade is a big one. Upgrades are just something IT departments do, although it might not be as noticeable to the user community," he said.

Ally Thorne, IT manager, The Wine Society, said her organisation -- which implemented SAP R/3 3.1h in 1998 -- has only minimal concerns about the discontinued maintenance for older versions of SAP's R/3 business applications.

"Our only concern would be that there may be a situation where we come across a problem that hasn't been identified and [SAP] won't be able to fix it. But 3.1h has been available for years so I guess it's unlikely that a problem not previously detected would arise now," Thorne said.

The Wine Society has 60 licences and plans to upgrade from 3.1h to version 3.1i.

Thorne said testing is planned in coming months to move to a CRM environment and the 2 per cent maintenance fee will come into effect as "we are only upgrading to the next version due to pricing.

"The pricing aspect of going to the latest and greatest would have a great affect on us financially, and business-wise with change management," she said.

SAP's Pike said the older R/3 releases are four to five years old and are very tried and tested, but the handful of customers preferring not to upgrade will continue to be supported.

"Our position is, of course, that we prefer customers to upgrade, but if they want to take the extra year of maintenance then that's fine," he said.

"If at the end of 12 months they still want to keep the older versions, we'll continue to provide limited support. We don't ever stop supporting our customers."

Pike said SAP Australia's professional services division is offering half-day upgrade planning initiatives including free technical checks for customers that want to take the extended maintenance offering.