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Contracts Contracts Contracts
An anonymous reader submits: "There's an article over at CNet about all those software contracts that are out there, and what to watch for before signing the dotted line. Using California's $95 million Oracle problem, they define what the general terms are that get used in software procurement and support contracts. While mostly geared at commercial software, one can use most of this article to target open source tech support contracts."
I've discovered that most companies that I've "contracted" with won't use the open source suggestions I give them simply cuz they can't SUE someone if things go wrong. I also state in my contract that they can't sue me for anything other than bad programming and for them to prove that! Ha!
when they ban enctryption only criminals wi$21*J *#JF$%!@#$':
Developers! Developers! Developers!
(when I think of the Oracle/Cali deal)...
"A fool and his money are soon parted."
Don't sweat the petty things. But do pet the sweaty things.
At least in California, the list of "things to watch for before the contract gets signed" is pretty short:
1) A $25,000 campaign donation to the Governor's re-election fund.
do you want the easy money out of contracts and the secret to avoiding bad contracts?
sign below and I'll tell you.
x__________________________
Jesus saves souls and redeems them for valuable cash prizes
I have to sign up for a Verisign test server certificate every two weeks. As part of this, I have to agree to a lengthy service agreement displayed in an editable TEXTAREA. Of course, I always delete the contract text before agreeing to it.
When perusing a software contract, beware any clauses containing language similar to this:
Client agrees that all clients database are belong to us. You have no chance to appeal.
Well, this is interesting.
I was hired this summer by a large corporation (4,000+ employees and will otherwise go nameless) to do software cost analysis on their mainframe software. They hired me precisely for this reason: to analyze each contract and summarize their software license/maintenance costs for the current year and into the future.
Thankfully, my company has been in business since the 1960's and are pros when it comes to language in the contracts. I mostly do work with mainframes, and I've found a few keys to look for:
1. Hardware upgrades - Many companies will charge additional license fees for upgrades to mainframe CPU's (often in MIPS or MSU ratings)
2. Maintenance - It is important to put some kind of "cap" on maintenance. A typical example: "maintenance shall not exceed the lesser of 15% of current license fee or 10% over the previous year." Also, it must be assumed that fees *WILL* increase the maxiumum allowable charge under the contract.
3. Usage - In a large corporate setting, companies often must pay for the use of software on multiple sites or for use of partially owned, divested, or acquired entities.
As you can see, the charges mount quickly. That's why it's essential only to run the software necessary, and nothing more.
-Bullseye
a customer may buy version 2.0...then the vender says they're moving to version 3.0 and won't support 2.0 in the next 6 months"
like that Win2k news last week?
In several other industries, there are "standard contracts", and I think it is well past time that became the case in the Software Industry. A specific example is the Building/Construction industry. They have "AIA" (I forget what that stands for, but it should be easy to find) standard contracts that they can call on so everyone is on the same page. A very good idea.
One reason I love Open Source software is that there are only a few licenses that I have to know about, and just by knowing the name of them, for example knowing something falls under the "GPL", or a "BSD" license, I know EXACTLY what to expect. This is of immense value to me as a user of software.
I think that property should be more heavily emphasized by the Open Source industry.
Frankly, I don't know why people put up with the EULA uncertainty and why the courts let Software companies take advantage of people in that fashion. They don't for most other products, heck even "media/content" products.
Erich Boleyn
erich@uruk.org
Businesses will try to screw others out of dollars most effective ways. Given that horizon for most software companies life expectancy is around 1-2 years(IMHO) the faster you collect money in the beginning of life cycle, the more likely you are going to survive later, nevermind those pesky customers. You can tell them damn lies, lies and more lies, but if your bank is empty, you have no business.
2c.
Nope, no sig
Since it was a government contract, the money belonged to the taxpayers of California... Am I to intrepret your post as a knock on Californians ?
: ) Good Job !
(j/k)
Im not here now... Im out KILLING pepperoni
"We comb through each word of every contract to make sure that the definitions that we think we agree to are the ones that are written into the document. It is worth the extra time and money to avoid getting jewed by the other party." said Stephen Weinberg, CTO of Dimension Securities.
I realize that the man is probably Jewish, and that he works in an industry that this type of language is the norm, but holy cow, does CNet have to print it?
It's bad enough that such epithets exist and are used, but does the man have to slander his own race by using the term? It's like black people who have struggled to gain acceptance in society and transcend racial stereotypes calling each other 'nigger'. It's sad.
Maybe it's just the paternalistic white man in me that's struck by how backwards the use of these terms is. Maybe my sensibilities are too high. In any case, I guess the only thing I can do is avoid using these words altogether.
The only point of a software contract tends to be to put the balance of power in the vendor's, not the customers, favor. How often does a vendor include guaranteed reliability, and free from bugs, with free updates? Compare that with EULA agreements that preclude them from taking any responsibility for the problems that their software may have. I'll admit that software is new and does not have completely solid fundementals, but be able to claim that they have no responsibility to their customer also means that they have no respect for them either.
when there are standardized EULA's for proprietary software. Free software is way ahead of the game here. Sooner or later, users will demand something reasonable from the proprietary majority as well. Someday I hope something akin to a software users' bill of rights lets us all sleep better at night.
The article states that a perpetual software license means that you can use it for the life of the product provided that you continue to pay the contract fees.
As I understand things, a perpetual license really means that once the software is licensed in a particular way, you can go on using it as long as you want. You will run out of support for it after your contract term is up, but you can still make use of the software.
I have run across this type of license often. It is tied to a hardware component, dongle, or (rarely) a particular site. I have fixed many an older machine just for the use of the software licenses attached to it. The contracts clearly stated the word 'perpetual' when defining the license.
In many cases, a physical device is used in combination with FlexLM to provide the license functionality. If you do fail to pay your fees and want to move the license, many companies will either require you to purchase a new license (at the current version) or pay all back fees to get a new license key for the version that was in use.
Anyone else think this definition is bogus, or was I misunderstanding what I was seeing?
This type of experience was one of the primary motivators for me to begin exploring OSS for my computing needs.
If you can learn to compile and use Open Source software, then you are set for life.
Blogging because I can...
It's all well and good to bitch at contracts that favour vendors but wait until you've left the cosy world of employment and created a startup. I was a lawyer for years working for startup companies and getting beat up in long negotiations with big players who understood nothing other than the fact they were big. All these "musts" for customers ignore the economic balance that must be worked out in every end user/supplier relationship depending on the cost of the software, the size of the startup, etc. A startup can be destroyed and I'm talking about companies that make millions per year.
I'd love to see the article written from the other perspective, for instance end users who never end up paying for their software because they refuse to complete acceptance testing though they continue to use the software. There's one you need a lawyer to avoid. The concept of repaying the whole value of the software for maintenance issues is crazy. If need be, you use a service level agreement that sets out reasonable goals and at maximum, proportional rebates on maintenance and support fees paid for the period of time the problem occurs.
And the concept that maintenance and support should continue on forever has sunk many a poor company, tying up valuable resources when they should be working on the next product.
Hee Hee!! That made me laugh out loud!
"Hereforth we, the company, will send to the customer 12 beautiful virginal massage therapists, daily, along with as much pizza and beer as required by the customer..."
for just having read about the possible licensing issues?
Of course, I always delete the contract text before agreeing to it.
An alternative with possibly interesting legal implications, paste the GPL (or any alternative licence/contract) into the testarea and submit.
Since there are apparently no server side validation, it could be readily argued that they have accepted your change of terms.
I wonder what the legal implications of this would be ?
there are many more open source licences.
And things get more complicated if some software is dual licenced or use an license that is incompatible wit other licences.
And this kind of thing might me important if you do support on some product.
If it was this simple why do people start flame fests here all the time over GPL and other licences.
I am starting to see this more and more. The process for implementing a business application seems to be:
I have recently seen the model for one organisation where the technical solution is located WELL below the Leadership and other management and workflow processes.They actually implemented a solution to . . . here it comes . . meet their actual needs.
Why is it so hard to get management to see the benefits of proper process in implementing a proper solution?
The weathers here - Wish you were beautiful
Having recently read "The Cathedral and the Bazaar", I must note that all of these problems pointed out in the article are the same problems ESR noted about closed-source solutions in his essays.
1) How does one price software, since it can be easily copied? You can't, because its not a logical pricing scheme.
2) Support is a big portion of the contract, which is where open source vendors cash in.
3) Customers complain about upgrade schedules and how they set up to use version 2, then are forced to use version 3 and readapt. The customers are at Oracle's mercy!
I think this reporter should read ESR's work, and this would all make sense.
(I also remenber seeing it posted once on Slashdot by AC)
The article has a link to new microsft contracting scheme. http://news.com.com/2100-1001-919097.html Microsoft seems to be quite an arrogant vendor, in the long run could help some of the other guys gain some market share.
Hello Cruel World