SAP Replaces Costly AI Models, Targets €2 Billion Savings

SAP is replacing some of the most expensive AI models in its products with cheaper alternatives when they can meet performance requirements, targeting more than €2 billion in efficiency gains over the next two years. The company uses more than 70 models from providers including OpenAI, Anthropic and Google, and says it will increasingly select the least costly model suitable for each task. SAP expects total AI spending to keep rising as adoption grows; the goal is to preserve healthy margins, not reduce spending outright. Because SAP generally charges for completed tasks rather than computing resources, lower model-running costs can improve profitability. Government and regulated-sector customers are increasingly specifying which models they will accept, while European clients are seeking local options, potentially limiting SAP’s choices in some cases.