A Guide to Pricing Calculation for Usage-Based Media in SAP CRM-Intellectual Property Management

  • by Neelesh Sugandhi, Senior SAP Consultant, Capgemini
  • May 23, 2013
Learn about the usage-based pricing concepts designed for media industries, and discover how to configure and apply them effectively in SAP CRM-Intellectual Property Management (SAP CRM-IPM) implementation projects.
Key Concept

In the media industry, license deals are priced or billed to the licensee based on usage. Licensees provide the usage data (e.g., number of subscribers, views, buys, or telecasts) to the rights owners. The pricing of license sales (i.e., the royalty) is then calculated based on such usage. To implement this functionality, certain standard SAP pricing concepts have been modified and redesigned. This helps to accommodate the widely prevalent media pricing concept referred to as usage-based pricing.

Usage-based pricing is specific to Intellectual Property Management (IPM), in which rights are sold based on the usage of an intellectual property. For example, media companies often sell the rights for a feature or season to television companies and price them based on the channel subscription or viewership. This number is provided to the media companies through a third-party agency, and the rights are priced based on the data. This method of pricing ensures that media companies maximize their revenue for blockbusters.

In this article, I provide only the delta configuration required for usage-based IPM pricing. Before taking the steps I provide, you must configure the following in your system:

  1. Standard price configurations should already be in place in SAP CRM, such as condition type, access sequence, and pricing procedure configurations.
  2. All IPM scenario configurations should be complete, such as transaction type, item categories, copy controls, CRM WebClient UI configuration, and so on.
  3. You should be familiar with the IPM process flow for the media industry.

Neelesh Sugandhi

Neelesh Sugandhi is a senior consultant in the Capgemini SAP service line. He has more than 10 years of experience in implementation and support of various SAP projects, during which he has worked as a technical consultant, functional consultant, and project manager. His core area of expertise is SAP CRM-SD pricing, sales, and service. He previously worked as a pricing expert with SAP Labs and was involved in many complex pricing implementations.

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