Software licensing is a serious business

The twin pressures of cost control and software piracy are bringing software licence management into the spotlight. Here is what to look for in a software licence
Written by Tom Davis, Contributor and  Bert Young, Contributor
Jim Doe could very easily be you. He is a systems administrator at a large sales and service company with 5,000 employees, more than 100 software applications and dozens of branch offices. Business is down, the pressure up. Managing his systems and networks for LAN workers and road warriors is no small task. And now his CFO and CIO have mandated cost-cutting measures while crowing about maximising existing IT resources. He has a sinking suspicion that the company has hundreds of unused copies of Microsoft Project, which means wasted money and upset bosses. What to do? Companies are increasingly being asked to control costs and prove they are getting the most value from their hardware and software purchases. Tens of thousands of pounds can be realised by tracking the true software usage against current licence levels, ensuring that annual licence costs are in step with the actual usage of the application. By monitoring not only which applications are installed on each machine, but which ones are actually being used, IT administrators can report on which licences need to be renewed each year or shifted to other departments. Software licensing management also helps prevent illegal software, a growing problem that hurts not just software providers but ultimately the customers. Illegal software use is not a trivial matter. For businesses, illegal software use poses dangerous vulnerabilities. Even if a company is unaware that they are violating a licence agreement, they are at risk for expensive audits, litigation, and penalties. Many companies purchase and install more software than they realise or need. One reason for this variance is comes from unauthorised installation of software by employees. With the widespread adoption of the Internet, the downloading of unauthorised software has dramatically increased. The risks of software noncompliance are serious. Both the SPA Anti-Piracy (a division of the Software & Information Industry Association) and the BSA (Business Software Alliance) are stepping up activities to combat software piracy. If a business is audited by one of these bodies, it not only faces possible penalties, but also must face the disruption and costs of achieving compliance. The four fundamentals
Software licence management represents a shift in software management practices. Previously, companies would monitor the "concurrent usage" of an application and implement a restrictive tool to prevent unauthorised use. Now the preferred model is a shift to "installation" based licensing or a passive model. Software licence management benefits companies and IT organisations in several ways: 1) Ensures the organisation is legally compliant with its software licensing and eliminate the financial (and other) risks of noncompliance; 2) Saves money on software purchases and planning; 3) Boosts productivity and reduce costs by eliminating overbuying and deployment costs. There are four fundamentals to ensure that your software licence management helps achieve your goals.
1. Application Monitoring -- to monitor, track and report on application usage
2. Reporting -- audit reports, execution and usage trends
3. Licence Compliance -- to determine/maximise licence usage and purchase compliance
4. Application Denial of Execution -- to prevent unwanted applications from running in the environment Application Monitoring enables the IT administrator to easily identify the applications they want to monitor by selecting them from a list of applications found in the environment. Once the application is identified, a simple drag and drop populates the newly created monitored applications entry. With proper application monitoring in your software licence management solution, the IT administrator has the ability to track the application information by machine, including the number of times the application has been executed, the last date it was executed, and the total duration used in minutes. Summary and detail reports can be generated describing which applications were used by which users, for how long and on which managed system -- comparing concurrent usage data to current licence ownership (compliance reports). This is useful for reconciling purchased software with used software for smarter purchasing decisions in the future. Reporting and Analytics enable the IT administer to strategically plan and respond to software management. What you should look for in this aspect of a software licence management solution is Web-based reporting for flexible detail on various levels of information including software totals, multi-level compliance, licences and denial history. - Software Summary Totals Report -- a high-level summary of all applications in the environment. It includes the application name, the version number, and the total number installations. - Overall Compliance Report -- show overall compliance on all monitored applications and whether or not they are in compliance with purchased licences. This report also lists the amount of licences for a specific application that are going unused. - Group Compliance Report -- provide detail on a specific product or a user defined product category. Data includes the number of licences, licences that are installed, and licences that are currently unused. - Machine Compliance Report -- list the specific machines within a group or user defined product category and their compliance status. - Unused Licences Report -- show the number of licences for a specific application that are currently not in use or have not been used in a specific time frame (user selectable). - Denial History Report -- show each incidence of an attempt to run an "unauthorised" application. Data includes application, user, number of attempts, and date/time information. Licence Compliance determines if the company is in compliance with the number of licences purchase for a software application. A good software licence management tool enables the IT administrator to set parameters to track and maintain purchased licences. By selecting a monitored application, the licence information can be captured. Licence information includes number of licences purchased, type of licence (upgrade, new purchase, OEM), quantity, and serial number. It is key that important purchasing information can be captured, including cost, date, purchase order number, and reseller information. It is also helpful to capture and track the physical location of the licence, with owner, location and relevant notes. Once this information is entered for each monitored application, IT administrators are able to determine overall compliance from both a group level and product level. This information will aid in determining the company's overall compliance and where unused licences exist. These "wasted" licences can then be reallocated to other users rather than purchasing new licences. Over the life of an application it may change hands and be acquired by a new company. The new owner may change the name of an application. In this scenario, it is important to be able to correctly associate a software licence to the new version of an application. A good software licence management tool provides the IT administrator with an "Aliasing" feature to list all names that an application might be known as. Application Denial or Desktop Lockdown is when, on occasion, IT administrators may need to prevent certain applications from running or set a specific list of applications that are allowed to run and lock out any other applications. A superior software licence management solution should enable the IT administrator to create an "Application Denial List" that the resident monitoring agent will check before executing an application. One of the advantages of the passive model monitoring agent over a real-time metering agent is that it takes into account the occasionally connected and mobile computing environment. The monitor agent should allow application monitoring information to be gathered and staged up for transmission once a network connection is established. This should also be true for the Denial feature. The denied applications should not be allowed to run even if the system is disconnected from the network. In conclusion, a proper software licence management solution can greatly benefit your company not only in compliance and productivity increases, but in cost savings by eliminating overbuying and underutilisation. In this down-turned economy, a good software licence management solution turns management pain points into true business profits. And even when the economy recovers and improves, who will argue with increases to the bottom line?
Editorial standards