SAP Agrees To A 27% Reduction In Software Fees Charged To Bankrupt Delta Air LinesSAP Agrees To A 27% Reduction In Software Fees Charged To Bankrupt Delta Air Lines

Delta Air Lines managed to lop about $1 million a year--a 27% cut--off what it pays SAP for software, as part of the airline's bankruptcy negotiations.

What makes the details interesting is that companies are notoriously secretive about what they pay for software--much more so than for hardware. Vendors often insist on that, wanting each customer to think it got the best deal.

SAP agreed to lower annual maintenance fees charged to Delta from $3.74 million to $2.73 million through 2009, U.S. bankruptcy court records show. The fees can increase 2% in 2007 and 4% in 2008. SAP also has agreed to drop all existing financial claims against the airline, "excluding claims for unauthorized use or disclosure of SAP proprietary information." Delta owed SAP $1,925 in consulting fees before filing for bankruptcy. The agreement needs approval from the bankruptcy court. SAP officials didn't respond to requests for comment.

Delta uses SAP's ERP software for work relating to procuring supplies and spare parts, the court record says. Delta signed the deal with SAP in 1999.

After 2009, Delta will resume paying SAP maintenance fees "that conform to prevailing market rates." And, presumably, stop sharing its payment terms.