Software Audits: How High-Tech Software Vendors Play Hardball (infoworld.com)

snydeq writes: InfoWorld's Dan Tynan offers an inside look at how high-tech software vendors such as Adobe, Oracle, and IBM play hardball over software licensing, pushing customers to "true up" to the tune of billions of dollars per year -- and using the threat of audits as a sales tool to close lucrative deals. "When it comes to software audits, the code of omerta prevails," Tynan writes. "It's not a question of whether your organizations' software licenses will get audited. It's only a question of when, how often, and how painful the audits will be. The shakedown is such a sure thing that nearly every customer we contacted asked us to keep their names out of this story, lest it make their employers a target for future audits."

Comments

Open source is the solution

[Anonymous Coward]

The only audits of open source software are to remove bugs. Ditch proprietary software and this isn't an issue.

Freedom, not Price

[Aighearach]

This is why I only use FLOSS software in my business, and why I don't care which Free/Libre/Open license it is.

Freedom means some external entity can't interfere or try to pull the rug out. I have what I have, I know what it is, and nothing will change unless I accept change.

Re:Freedom, not Price

[sjames]

You've obviously never tried to actually be compliant. When MS itself cannot tell you how many of what license you need and changes it's mind regularly, it is literally impossible to be certain of compliance (because they're not) short of buying an unlimited site license for everything.

Re:Freedom, not Price

[Aighearach]

Only works if you don't require any specialty software whatsoever, which is practically nobody. Anything specialized, like CAD tools, EDA tools,[blah blah blah]

Hilarious, some of the most important software I use in my work is the EDA and CAD tools.

What makes you think that people with software freedom don't have software? What makes you think that proprietary software gives you access to something nobody else does?

"Specialized vertical market applications" like Tow Truck 2000, and shit. You don't have to buy that stuff to work in those industries. Software isn't Harry Potter magic spells, that proprietary software isn't a special sauce that enables work in those industries; it is just one way to organize your workflow.

The examples where you really need special software are rare; they certainly don't include EDA or CAD. But if I wanted to be in the business of selling weather forecasts, I'd need specific software because humans can't predict the weather and there are very few engineers working in that field. Anything engineering-related, of course, has FLOSS alternatives already, and generally can be done without even using computers.

Like in the 90s when people told us we "had to" have Microsoft Office, and kept repeating it even after we pointed out that we use something else... successfully. Or when people insist you "have to" use an IDE to write code, because more people use them than don't.

If I was in a field where everybody is totally locked in to proprietary crap software in the whole "specialized vertical market," then I'd be in the perfect position to totally disrupt that market by offering a FLOSS alternative. That is the business reality in the real world; choices exist.

Re: Ok, so how should it work?

[Anonymous Coward]

The open source business model works just fine. Companies like IBM and Redhat use it with no problem. The source is open and free, but they make money by selling complete systems and providing support. Those things are valuable enough to businesses to pay for. There are a lot of corporate contributions to open source software as as result. It's in the interests of those businesses to maximize the quality of the software so more people purchase support and enterprise systems.

Re:Ok, so how should it work?

[Anonymous Coward]

Not see what is unfair or unjust about this. The "hardball" tactic described here is to find companies that are stealing software, and offer them this "true up" deal.

Except in many cases, that isn't at all how it works.

Someone will send an anonymous "tip" that a company is using unlicensed software. Often this is a disgruntled employee or ex-employee. Hell, BSA has been running ad campaigns on Facebook for a while now encouraging people to report companies in exchange for the possibility of a small reward.

The software companies (Or BSA on their behalf) will start hassling the reported companies, whether or not it is true. This leads to either a voluntary audit of their licenses (Which still costs quite a bit in time and effort) or legal action. Every instance I've heard of companies going through with the voluntary audit has had the companies threatened with having trivial, honest mistakes punished with large fines and legal action. It's a losing proposition for them, even if they've done nothing wrong, or have small technical issues with their licensing that they've made a good faith effort to have in compliance.

It is a complete shakedown.

Re:Ok, so how should it work?

[vux984]

This isn't a company using software illegally.

Isn't that exactly what is is though?

This is Microsoft going after their small business customers that can't afford to pay the legal fees and threatening them with legal action just for the hell of it.

I've been audited by microsoft; it took a couple hours to fill out. They asked a few follow up questions and were satisfied and went away. It wasn't a big deal because I had documentation. I mean, you do maintain a software inventory right? You know where your licenses are right? You do actually have enough licenses right?

So that you know you are in compliance with your license agreement right?

The only way I'd "true up" is if I knew the audit would find a lot of non-compliance's... and then truing up, like the other poster said... its sort of like an out of court settlement. I don't acknowledge any wrong doing for what I was doing, they get some extra money, we sort of agree how to square things off... end of story.

But I don't need to true up because I'm clean. If they want to do a more thorough audit themselves, they're welcome to have at it. It's their money to burn.

Re:Ok, so how should it work?

[Anonymous Coward]

> I'll tell you what they do - they let you correct "trivial, honest mistakes"

You're correct. I made a trivial, honest mistake on my taxes one year. They sent a form showing the correct calculation, and a bill for the difference, and I paid it. End of story.

Re:Ok, so how should it work?

[ewhac]

But I don't need to true up because I'm clean.

Surprise! We unilaterally changed the EULA terms (paragraph 69 lets us do that). Because of reports of loading issues, running our software on 1 gigabit or faster networks requires a mandatory subscription to our Premier-III support tier. Also, an Intel "hyperthread" now counts as a full core. You can still run on a virtualized host, but only using virtualization software we've vetted and approved for use (surprise! There's only one, and it's our own).

Are you clean now? Didn't think so. Enjoy the shakedo^H^H^H^H^H^H^Haudit.