Could your firm be penalised for software piracy?

By: Lucy Hunt

Date: 7 September 2012

Pirate CD{{}}When it comes to protecting its copyrights and financial interests, the software industry is very meticulous indeed. And for businesses that, even unwittingly, use unlicenced software or have insufficient licences for each copy, the financial fall-out can be severe.

The Business Software Alliance (BSA) and other trade bodies that represent the interests of software manufacturers have recently stepped up their efforts to hold businesses of all sizes to account. Software audits are on the increase, and according to recent figures from Gartner, your company has a greater chance of being audited this year than not. And with the main aims of the BSA being to raise money for their members (including Apple and Microsoft) and encourage businesses to ensure licence compliance, don’t expect them to show any lenience for accidental infringements either.

What are the consequences of inadequate software licence management?

If your company is found to be non-compliant with licencing requirements then the costs can be significant, and include fines for each piece of offending software and the price of purchasing additional licences to achieve compliance. In 2010, the cost of poor software licence management for one London education firm was £80,000, in the form of a £40,000 settlement with the BSA and another £40,000 to purchase sufficient licences for the Adobe and Microsoft products in question.

Protecting your business

The problem of unintentional over-deployment of software is a common one, particularly for rapidly expanding or changing businesses. What is needed to prevent problems arising further down the road is careful and diligent software licence management. Someone, somewhere in the company must be aware of exactly what is installed on individual machines or on the network, and be able to correlate this to the number, type and details of the relevant licences for each piece of software installed.

Implementing software asset management is essential for all businesses — including SMEs — as it safeguards them against the risk of fines in the increasingly likely event that they undergo a software audit at the hands of a vendor or an organisation like the BSA.

In fact, attentive and methodical software licence management can actually reduce the risk of being audited considerably. In many cases software audits are a result of tip-offs from current or former employees seeking the maximum £20,000 reward offered by the BSA. Of course, if your business remains in compliance at all times then there will be nothing to tell.

Lucy Hunt is a technology and business blogger and she also writes on behalf of License Dashboard, a software asset management and software management solutions vendor.

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