Software licensing creates some tricky issues for IT. In this guest post, Karl Young offers some advice on getting compliant – without overspending on licenses.
Compliance with software licensing is (and always has been) imperative in today’s modern market — but it’s something that can easily be forgotten. Software can be installed onto multiple devices very easily, and each instance of this software counts as the use of a single product. This creates two potential dangers — and both will cost your company money:
The first danger for businesses is the worry of overspending, which can go undetected for years. Businesses can easily overspend on software, not realizing that they simply aren’t using it or don’t need it.
There can be a number of reasons a company is over-compliant when buying licenses – one of which is undoubtedly to avoid the chances of an audit. Audits on your business’s licenses can prove very costly if you are found to be overusing licenses, and overspending on them can help to avoid this.
It could also be due to not knowing how licenses work, or not knowing how many licenses the company has already. Re-harvesting licenses when someone leaves the company can be another cause of over-compliancy.
Nevertheless, businesses over-compliance means just one thing – overspending. A lot of money is being wasted to avoid a potentially costly audit — however this process itself can damage a company’s finances considerably.
The second danger worrying businesses is under-compliance. In contrast to over-compliance, under-compliance is another issue facing today’s companies. While this may save money in the short-term, it has much more lasting effects, as software distributors see this as piracy. It would also be treated as such if discovered.
A study carried out by The Federation Against Software Theft (FAST) recently revealed that 68% of UK organisations do not have plans for under-compliance of software, meaning 68% of businesses are at risk of being audited by establishments like the British Software Alliance (BSA). This can lead to financial and legal penalties. This is becoming a very real possibility as IT research and advisory entity Gartner shows that the chances of being audited are now as high as 65%.
A British safety firm was recently fined nearly £100,000 (or more than $150,000) for using unlicensed software from Adobe, Autodesk, Symantec and Microsoft. The firm claimed that this arose as a result of a recent acquisition; however this was thrown out by the regulating authority, in part due to the amount of unlicensed software.
This highlights how important it is for businesses to control their software licensing – whether it’s in the day to day running of the company or during acquisitions or mergers.
When a company is faced with an audit it is likely to implement a solution to avoid any possible penalties in the future. However, this is usually too late to avoid the initial penalties by establishments like the BSA – however it does still help maintain an optimized estate going forward, ensuring an organization is both compliant and not overspending. Companies usually utilize solutions such as Software Asset Management (SAM) programs to avoid over- or under-compliance, as these take the confusion out of organizing hundreds of applications on hundreds of machines. It does this by automating the process, and works on three levels – Discovery, Management and Procurement. The discovery stage is where the SAM software collects the relevant software data from the various networks, and stores it in an easy to view and understandable format.
This then allows the business to plot the data against its license management system – which details the resources available and where licenses are needed. After review it can then be utilized in the procurement stage, where the company can ensure compliance is exactly matched.
Once SAM solutions are installed they can be run automatically, and with minimal review. This software would also help should your business be audited, as it would have the relevant information and resources easily stored and accessed by both the business’ IT rep and the authorities.
About the author: Karl Young a technology and business blogger, who’s working and writing around software asset management tools and License Compliance.