Are Spreadsheets Software or Data?

ideveroux asks: "I have started a company which designs Excel Workbooks to duplicate paperwork required for Bingo Halls in Mississippi. In all my years of experience, I have never considered a spreadsheet itself as software, only Excel. However, the Mississippi Gaming Commission has gotten itself into my business and is trying to require me to license my company with them ($10,000.00 and government involvement) because any 'software' sold to bingo's have to be licensed by them. What is your take? Are the workbooks software by themselves? As a startup with no venture capital, I haven't the resources to secure an attorney, nor pay their extortion money. Thanks for your input." Spreadsheets have always existed in this grey area because they mix functionality with data. This issue has grown more tricky over the years as in-spreadsheet macros become more and more complex. I don't think of spreadsheet files as software, because you can't edit or execute a saved spreadsheet without it's associated application. However some can say that anything that implements an algorithm qualifies for term. What are your thoughts on the subject?

Comments

Good 'Ol Boy Network

[Jeremiah Cornelius]

This is their Ball, Bat and Sandlot. It doesn't matter if you are right and they are wrong - the state commission is RIGHT. You said it yourself - your a little guy. The Good 'Ol Boy network is there to make sure an upstart like you doesn't get in on the game, unless they get a cut. If you aren't big enough for a cut, then you don't get to play at all.

No technical definition of software will alter the circumstance, because technical issues are irrelevant to the those controlling the issue. 10,000 USD is a good fee from their point of view. It's much less than the cost of fighting the battle in court - which is also run by more Good 'Ol Boys.

I wish that there was a less pessimistic outlook. Welcome to the gap between perception and reality.

No solution

[rw2]

I just wanted to poke cliff in the ribs for defining software as something that doesn't require another application to execute.

Dude, you've just eliminated *all* scripting languages from the definition of software.

*My* next step would be to ask the gaming extortion folks where you can find the definition of 'software'. There should be one.

Re:No solution

[Cy Guy]

you've just eliminated *all* scripting languages from the definition of software.

Actually, every file that relies on an algorhithm to perform some function including the OS, even wordprocessing documents if they use anything more sophisticated than plain ASCII text - since they consist of instrustions that are carried out by the processor either directly or through the use of one or more intermediary programs.

My question is, who are they not charging? Are they charging MS seperately for every single different application that comes with a default Windows install? Are they charging MS seperately for each compnent in MSOffice?

One way around the license might be to convert the spreadsheet to java applet and host it online (hopefully in another state) then sell it as a service rather than a program that gets installed on the user's PC. Since the transaction would cross state lines, the state would not have jurisdication to regulate or license your service. Even within the same state, it's likely they would have real problems proving that the online spreadsheet is software, and even if they did, they would have to show how they were enforcing the license on other webservices such as Hotmail.

Get a lawyer

[coyote-san]

Get a local lawyer with some knowledge about the field. This is one of those questions where what we think doesn't matter - it will all down to local statutory and case law.

That said, two questions stand out to me:

• Is "software" even legally defined in the State of Mississippi? It's possible that "software" is either undefined, or it's defined in some archaic fashion. E.g., are you providing your spreadsheet via a stack of EBCDIC encoded punch cards containing Fortran or COBOL source code?
  

  
  On the flip side, it's possible that you're dead in the water because the good people of the great state of Mississippi have already decided that Excel spreadsheets shall be considered software, not data.
  
  

• Has Microsoft paid the $10,000 fee for their license? Or $100,000, if you treat the OS, browser and Office components as separate programs? What about the other utility software? If they haven't, and the statute or regulations don't provide for exceptions, then this is preferential enforcement and that should raise some eyebrows. But then again, you're trying to sell something that's specific to Bingo halls operating in Mississippi, not a general tool.
  

Spreadsheets are DATA

[renehollan]

I know I'm going out on a limb here, and there may be spreadsheets that violate the premises I use to conclude that they are data and not software, but most that I've encountered qualify as data.

Consider: Is '5' a program or data? It is certainly interpreted from it's representation within the computer to produce a literal '5'. I think it would be folly to argue that '5' is a program, though in the process of being presented to us, it controls many things, rather like a program. Still, we consider it data.

Now, consider (1+1/1000)^1000. Is that a program or data? It certainly requires interpretation to produce a result. But that result is an approximation to e, the base of the natural logarithms. We may also series expansion approximations to irrational numbers, like pi. Are those programs? I would still say no.

I'd say this because the result of these "programs" does not change with each run. Their output may as well be data. A program with no input (and I've yet to see a spread sheet prompt, when I have it recalculate, unless there is some error) always produces the same output and can be considered identical to that output. It is precisely because spreadsheets fix the data that their embedded formulas use, that the spreadsheet as a whole can be considered data. Unlike a program, a spreadsheet isn't "run", it just "is", once the numbers are entered. Errors in the embedded formulae are no different than errors in transcription, or manual processing of the numbers. Both these are subject to audit, so incorrect embedded formulae can be caught when the data is presented. This is not so with a program, where the input and output are distinct from the program itself.

In the same way that accounting records can be audited, spreadsheets can also be audited: all the intermediate steps are still there. There is no need to "pre-audit" or "license" the program to make sure it is correct.