£750,000 paid up for unlicensed software use

Microsoft is now three-quarters of a million pounds richer after settling out of court with two firms that were using unlicensed software

Microsoft has reached settlements of £500,000 and £250,000 with two UK customers over unlicensed software.

The software giant said the settlements — reached earlier this year — show the potential downside for companies of not having the proper controls in place to manage their software licences.

In addition, a survey conducted by Microsoft of 25 UK customers that have worked with Microsoft partners in the last year on software asset management projects found that between them the companies had 2,000 copies of unlicensed software.

Alex Hilton, Microsoft UK's licence compliancy group manager, told ZDNet UK sister site silicon.com: "Two thousand copies out of 25 customers is shocking and that's just a small sample."

He said in many cases companies are not aware of unlicensed software as an issue: "I think a high proportion of it is not malicious or deliberate; it's just not viewed as a high priority."

Hilton added there are big advantages for companies that get their software licensing in order, on top of cutting the risk of big settlements with unhappy software companies.

"When companies get into a negotiation with suppliers they are in a better position because they know what they've got. It's not just about software it's about IT asset management."

More help could be at hand with a new software asset management standard — ISO 19770 — in the works, he said.

"That gives customers something to work towards. Now what we've got is a document that says here are the accepted criteria that you can adopt and software asset management looks like this," he explained.