Software License Terms Becomes Competitive Issue in the Software Industry

SPA Study Shows Nine in Ten Publishers Reevaluating Their License Terms and
Conditions

November 12, 1993 (Washington, DC) - The license of a personal computer
application has become an important part of the product's feature set,
according to a recent study of software licensing by the Software
Publishers Association (SPA). The study examined the license policies of
ten large software publishers: Aldus, Borland, Claris, Corel, Lotus,
Microsoft, Software Publishing Corporation, Symantec, Wall Data, and
WordPerfect. Topics included concurrent licensing, enterprise or site
licensing, licensing for use away from a user's primary desktop computer,
and the potential changes to license policies publishers were reviewing.

"Software publishers have come to realize that licensing is not just a
legal issue," said SPA Research Director David Tremblay. "For many
customers, licensing is also a value issue. Publishers are listening to
the needs of their customers and are trying to make application licenses
fit the needs. Concurrent use licensing, and flexibility in home/laptop
use all came about because users demanded them. As the industry has grown
more and more competitive, publishers are changing their licenses to make
sure they both protect their intellectual property and really serve the
needs of their customers."

Only one of the ten publishers interviewed in the survey said that they
were not re-examining their licenses now. Four of the ten said that they
were fine tuning or simplifying their license language; the other five
publishers were in active review of their licenses.

The 1993 study found that for the most part, the debate over concurrent
use, a hot issue in the 1992 study, is over. Most standard business
productivity applications licenses now include a provision for concurrent
use. The recent study also found that nearly all publishers interviewed
offered a site or enterprise license plan. These agreements have evolved
to become volume discount agreements, where the pricing per unit goes down
as the number of units go up, but the customer pays for each unit used.
Under some agreements, the software administrator is given the flexibility
to make copies as needed. The customer then pays the publisher or its
distribution partner monthly or quarterly for the copies. Many of the
enterprise license plans also include an optional maintenance plan, under
which the user company is automatically licensed for any upgrades or
updates that are issued during the term of the agreement.

Copies of the full study are available without charge from the SPA by
writing:

"1993 Business Software License Survey"
Software Publishers Association
1730 M St. NW, Suite 700
Washington, DC 20036-4510

The Software Publishers Association is the principal trade association of
the PC software industry. Its 1,000 members represent the leading
publishers in the business, consumer, and education markets. The SPA has
offices in Washington, DC, and Paris, France.

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