German software giant SAP has officially confirmed on Tuesday that it in the process of a total withdrawal from the Russian market, and is not just halting sales to the pariah country.
In early March, SAP (along with IBM and Oracle) announced they were suspending all business in Russia, but an Ukraine government minister Mykhailo Fedorov at the time tweeted that SAP’s action’s did not go far enough.
Then last week SAP’s chairman and cofounder Professor Hasso Plattner was quoted by Reuters as telling the Handelsblatt newspaper that the company was looking into closing its business in Russia after the country’s invasion of Ukraine.
Now the German software giant on Tuesday has officially confirmed “an orderly exit from our operations in Russia.”
“We continue to believe that coordinated inter-governmental sanctions offer the best way to end the war in Ukraine, and we have implemented them without exception,” said SAP. “In line with our responsibilities as an employer and provider of business-critical software, we have also gone beyond sanctions. For example, we halted sales in Russia and Belarus and are in the process of shutting down all cloud operations in Russia.”
“Today we are announcing further steps toward an orderly exit from our operations in Russia, where we have operated for more than 30 years and have built an excellent team,” the firm said. “As we wind down our operations, we will focus on responsibly managing the impact on these employees.”
SAP said that on the cloud side, the data in its data centres belongs to customers, not to SAP.
“As part of our cloud shutdown, we have therefore given non-sanctioned companies in Russia the choice to have their data deleted, sent to them, or migrated to a data centre outside of Russia,” said SAP.
It said that Russian companies will not have their contract renewed upon expiration of the current subscription term.
Meanwhile those Russian customers with on-premise products, will discover that SAP is intending “to exit the support and maintenance of our on-premise products in Russia.”
The firm said it is evaluating multiple options to execute this decision, each of which will ensure SAP continue to honour its obligations to non-sanctioned customers.
It pointed out that regardless of any SAP decision, existing customers in Russia using on-premise software would still be able to use their products.
They just won’t be able to gain official SAP support.
SAP also addressed its ongoing support for Ukraine.
“We recently announced an additional contribution of €700,000 to support refugees in the region, bringing our total contribution to €3.7 million so far,” said the firm. “Additionally, SAP software contributions are supporting relief efforts. We recently donated SAP Ariba solutions to an NGO working with the State Enterprise Medical Procurement of Ukraine, which will allow the speedy purchasing of medical goods for the Ministry of Healthcare of Ukraine.”
SAP said it has also enabled suppliers on SAP Business Network to declare their readiness to provide humanitarian aid to Ukraine. Some 2,500 companies have already taken this opportunity and offered their assistance through the platform.
“Our hearts and hopes are with the people of Ukraine,” SAP finished. “More than anything, we want this war to end. Until then, SAP will continue to help those affected and encourage the restoration of peace.”
SAP has operated in Russia for the past 30 years, and has 1,200 staff in Russia, whose future is now uncertain.
The Russia, Belarus and Ukraine market only contributes about 1.5 percent in total revenues to SAP.
And SAP is not the only firm completely withdrawing from Russia.
Last week, Finnish telecoms giant Nokia confirmed it was pulling out of the Russian market altogether, and not just suspending its operations in the country.
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