Understanding and Negotiating Software License Agreements: What Nonprofits Should Know Webinar **TOMORROW**

Just a reminder, my webinar for nonprofits on reading, negotiating and (more importantly) understanding software license agreements is tomorrow. It”s free of charge so join if you can, click here for registration.

I”ll note, prepping for this webinar has been interesting. I negotiate software license agreements day in and day out at work but polled a few organizations to see what it is they wanted to know. And the overwhelming response was  silence. I think a cricket might have actually broken the silence in one instance.

I”m positive this wasn”t because the founders, managers and staff I spoke with didn”t care. They do. What I believe was the case, as it so often is, is they didn”t know what it was they didn”t know. And hadn”t really thought about what they wanted to know. Which makes sense.

Most software vendors today throw up 8 point font click agreements that you get arthritic scrolling through. Many don”t offer the option of printing and quite a few would have you believe you don”t have a say. Which isn”t necessarily true.

For this reason alone, I start the presentation tomorrow with a few thoughts on why understanding software license agreements is important and how it impacts organizations. For starters, the license impacts:

  1. How you use the software, when, where and by whom. Naturally, the license outlines how the software can actually be used. The tricky part is making sure the uses set out in the license cover how you plan to actually use it. More often than not, this isn”t the case and a few modifications are required. For example, making sure affiliates or clients can use the software or addressing prohibitions on copies where you want to make a backup copy.
  2. Whether the software and/or vendor experience meets your needs. There”s nothing worse than being stuck in a 2 or 3 year license agreement, paying for software that doesn”t do (or can”t do) what you need it do. For organizations,the allocation and use of resources is key. Paying for “meh” software can”t be one.
  3. The investments or expenses you have tied up.  For the purposes of budgeting, organizations will want to understand what amounts will be paid up front and what can be paid over time. For example, there are often three subsets of fees paid during the initial stages of a software purchase. Aside from the license fee, you may discover you must also pay an hourly professional service rate for information you stored in a separate piece of software that needs to be migrated over in addition to the annual maintenance fee. If you”ve only budgeted for the license fee this all could present a problem later in the fiscal year.
  4. Your reputation with donors and beneficiaries. No one likes dealing with a broken website. If you solicit donations or provide services online your website may be the first touchpoint people have. You want to ensure that everything on the site, or running the site, operates as it should when it should. And if it doesn”t, you want the flexibility of getting it fixed in a timely manner or going elsewhere.
  5. Exposure to fines, penalties, sanctions and fees. I”ll go into a little more detail in the webinar about this, but there are Federal and State laws that outline how personal information (addresses, emails, social security numbers, etc) must be treated. There are also laws that govern who can access US software and where such software be stored, used or accessed. If the software vendor or someone on its end fails, you want to make sure you”re covered in the contract. Software vendors are also starting to make money hand over fist by auditing how customers use their software, then back charging for mis-use, access being provided that shouldn”t  have or licenses installed that weren”t paid for. The better you understand the contract, the more protection you have in such an audit.

Then I work through a few of the provisions you”ll find in a license agreement and a few negotiating tips. Looking forward to the presentation tomorrow and hoping to see a few of you on there!