The importance of independent technical & legal expertise when dealing with software licensing
Software licensing is getting more challenging every day. This is especially true when you consider that some software vendors, such as Oracle, IBM, SAP, Salesforce and Microsoft have been creating business software for decades and have slowly migrated to cloud-based offerings, whereas others such as NetSuite and AWS were practically born in the cloud.
To make things more challenging, the biggest and brightest software vendors have evolved, increasing their portfolio of offerings over the past decade or so through technological evolution and/or a series of acquisitions — all of which pave the way towards more complex licensing regimes.
Let’s take Oracle, for example. The US-listed company has acquired over 100 unique software companies since its takeover of PeopleSoft in 2005. This includes acquiring new customers, existing products, licence metrics, contracts and terms & conditions.
Moving towards a common licensing end goal creates uncertainty for everyone in these instances. Often, organisations that invested in technology prior to an acquisition, or migrated to, deployed, or expanded licences sequentially and over time, often find that, with constantly changing licensing policies, they’re under-licensed.
“Organisations are often caught out by not being aware of all the factors that affect their compliance with usage of a vendor’s software”, explains Oracle licensing expert Palisade Compliance APAC MD Anna-Rita Stanley-Best.
Other software licensing challenges include third-party vested interests and internal software management policies.
The business partner to whom you outsourced your IT may in fact be a vendor partner and reseller, with its own agenda and reasons for you ‘needing’ more licences.
These are all real challenges that customers face — and they need to be wary as the software giants often impose audits and significant penalties for violating or breaching licensing agreements, even if they’re unintentional or a result of undefined uses.
To avoid complications, many businesses now find they’re better off consulting with an independent third-party that has the technical, commercial and legal expertise to help deal with licensing compliance-related matters. The key, in most cases, is finding a credible independent such as Palisade Compliance.
When licensing experts are tied to the software vendor in some way, such as their reseller or partner status, they are duty-bound to inform the vendor when one of their clients has violated the terms of a licensing agreement — instantaneously attracting a notice to pay a fine.
On the other hand, dealing with an established and independent team of licensing experts helps an organisation feel secure in that the people they engage are looking after their interests first, and are able to help determine next steps to set things back on the right course, without setting off any alarms unnecessarily.
Finding a team that has the competence to really work through the contracts in place is important, too. Software licensing contracts these days are quite meaty, with clauses embedded in guidelines & policies that the software manufacturers can alter at will; alterations based on their own changing market needs and demands.
As a result, organisations engaging with external licensing consultants must find a team that has experience dealing with such matters, ideally with years of experience of either working in such an organisation or ideally, as an auditor or enforcer of contracts themselves.
Stanley-Best’s organisation, for example, has a combined experience of more than 200 years with Oracle. Some of her team members have even served as Oracle license auditors in the past.
Companies that have the foresight to engage an independent expert before they’re slapped with a fine or hit with an audit notice often find that they saved hundreds of thousands of dollars, if not millions, through a simple exercise of careful re-examination of current contracts, creating an appropriate inventory, and optimising licences as necessary. It’s in this process that the use of an independent third-party licensing expert can save your organisation’s own valuable resources.
Thus far, Palisade Compliance has helped more than 300 organisations save millions of dollars in fees and penalties from Oracle — and the company is always waiting for a new challenge.
*Some of the companies featured on this editorial are commercial partners of Tech Wire Asia
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