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Tips for managing software licences

The most important features of a software licence and pointers to finding more information.

What are software licences?
Statements by the manufacturer or reseller of the software, telling how the program can be used. They often simply give permission for the software to be used. For the purposes of most business users, licensing software in this way is similar to buying it.

Read the small print before installing a new piece of software on your computer whenever possible. Most concern copyright, but some do state terms with other issues.

Which software do licences apply to, and where can I get them?
Almost all software use licences. In the case of Microsoft Office, for example, the licence is usually attached to the outside of the CD-ROM or DVD case, but some appear once the program is installed.

How do I renew my licences?
Licences are rarely renewable on an annual basis. Usage resembles a subscription, such as for anti-virus software, which needs to be updated on a regular basis. Costs vary depending on the program(s) used and how many people need to access the software.

How are software licences enforced?
Software publishers do enforce their licences. Keep up to date by recording which software packages you use and the dates on which they were installed. Keep licences printed on certificates, securely in the office.

What if I want to use the same software on more than one computer? To install the software on more than one computer, read manufacturer or vendor guidelines about shared usage.

As your business grows, licence management can become more complex. Several programs have been developed to help you cope with this - some are sophisticated enough to scan a network and report all the licences in use on various computers, as well as reporting on updates and patches.

What happens if I don't have a licence?
Using unlicenced software is breaking the law and committing software piracy. Three main types of piracy exist, and all can result in hefty fines:
  • End user piracy. Downloaded or reproduced copies of software distributed without licensed permission. This includes swapping and copying disks, using one licenced copy to install a programme on more than one PC.
  • Client-server piracy. Occurs when a central copy of software is used by many employees on a business network.
  • Internet piracy. Software is downloaded from an online source(P2P, file sharing). Unregulated Internet software auctions are popular venues for pirates to operate. Increasingly rapid download speeds make it easier to buy and sell pirate software online.
The Business Software Alliance (BSA) estimates that UK firms have paid out over £1.8 million in fines since 2000 for software piracy. The BSA claims that the UK's high rate of software piracy--revealed in a 2003 report to be 29%--is not due to ignorance. Businesses are failing to devote resources to software compliance. The BSA reinvests fines paid into initiatives to raise awareness of the risks associated with illegal software.

Where can I get more information?
For more on software licences, and a clear guide to the law, the Business Software Alliance offers a wide range of information.

The Alliance Against Counterfeiting and Piracy (AACP), founded in 1999, enables industries affected by piracy to join forces in lobbying government about anti-piracy legislation. Go to for more information.

The Federation Against Software Theft (FAST) exists to combat software piracy and oversee software licensing in the UK. Go to for in-depth information on anti-piracy software law.
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