License management

With license management (including software -Lizenzmanagement) refers to a process in companies that the legal and efficient use of proprietary software safeguards in companies. License management influences all areas of the company, from procurement to every PC workstation to management .

overview

Demarcation

In principle, under German law there is the possibility of acquiring software as part of a purchase of goods , for example from a dealer (new software) or another user (used software), i.e. from sellers who are normally not authorized to issue licenses and to grant license agreements conclude. Use is then determined by copyright law and no license agreement is concluded, not even if a corresponding confirmation is requested from the user when installing the software.

As part of a license agreement, numerous provisions for the distribution and use of software can be freely agreed between the parties; the terms explained below have become commonplace for this purpose.

background

From a technical point of view, an installation program, for example on a data carrier such as a CD , could perform any number of installations .

The author's consent to the use of commercial software takes the form of license agreements , for example , which determine under which conditions and how often the program may be installed. Re-use of the license after uninstalling the software or scrapping the target computer is often regulated by the license agreement. A technically identical software product can be used simultaneously in a company, depending on the existing license agreements, under different license conditions, for example as a concurrent user license model for workstations and with a dongle for notebooks. A license agreement can also regulate the commercial re-use of software, even if it is e.g. B. can be used free of charge.

In Germany, the consent of the author or the rights holder is required if the data carrier does not originate from the author (copy within the meaning of §69a-g UrhG ) or originates from him, but is to be used for more than one installation, which is for example in the context a license agreement can be granted.

Consequences of license violations

The civil law consequences of license violations are defined in the license agreement . In addition, they can also constitute a violation of copyright law and thus a criminal offense.

Situation in the EU

In principle, the resale of licenses by a licensee can be excluded in the license agreement, but this exclusion has no effect in the EU, for example.

The subsequent installation of updates to the software or as part of maintenance contracts does not reinstate the rights of the licensor. Only the split-up of the license is still dependent on the license holder's consent.

Not every violation of the license agreement means a violation of copyright. The licensor (software manufacturer) can only assert claims outside of copyright law under civil law and only against his licensee.

Situation in Germany

If there are serious license violations, the licensor may, under certain circumstances, be entitled to extraordinarily terminate the license agreement in accordance with Section 314 of the German Civil Code .

If the licensee sells the license to a third party, the third party can use it freely within the framework of copyright law.

Proof of license

Licenses for installed programs are contractual documents and should be kept as such, in particular to prove the usage rights in the event of a dispute.

The rights and obligations from a license agreement are classified in license management according to three to four factors:

1. Type of license
2. License class
3. License type (used depending on the manufacturer)
4. License metric

Type of license

The type of license describes whether the license allows exactly one deployment ( single license ) or multiple deployment ( multiple license ) - or whether the license regulates the commercial re-use of the software within the framework of own software products or systems. If a license key is used to activate the authorized provisions, the following principle applies: There is one license key for each license agreement. Multiple licenses therefore offer great advantages in companies when it comes to the technical provision of software, since all individual provisions can be made with the same license key and thus automated software distribution is significantly simplified.

Multiple licenses can be described differently depending on the license metric, e.g. B .:

• Volume license (includes n licenses)
• Site license (includes all deployments within a named site)
• Company license (includes all deployments within the company)

License class

The license class of a software typifies the contractual requirements for the use of a software. The following common examples of license classes each require separate evidence (unless otherwise stated):

• A full version can be used on its own and does not require a previous version.
• An upgrade requires the existence of a previous full version and, if applicable, complete proof of all previous upgrades. For license accounting, upgrade and downgrade licenses can only be taken into account if the continuous license chain from the previous full version via corresponding upgrade licenses results in an effective full license. This license chain formation and its documentation is also called assembly .
• Updates include bug fixes or smaller software additions, mostly as minor versions or hotfixes within a version. When using an update, no additional proof of license for the update version is required.
• Add-ons are additional components to software that do not have to be included either by the software manufacturer or in the license to use the software.
• Client Access Licenses (“CAL”) are additional licenses for using the services of a server on which, for example, a database offers its services. The use of the database may require additional licenses.
• Combinations and special forms:
  • Add-on upgrade (an add-on in the form of an upgrade)
  • CAL upgrade (a CAL in the form of an upgrade)
  • Cross-Upgrade (from a commercial point of view similar to an upgrade, but technically depicts the change to a different product)
• The downgrade license entitles the licensee to use a lower product version than the licensed version. Example: A Microsoft Windows 7 license can authorize the installation and use of Microsoft Windows XP. Microsoft Windows XP and Microsoft Windows 7 are licensed, Microsoft Windows XP is installed.

License type

In the literature is sometimes also between types of licenses and license metrics distinguished, wherein the license type to the type of measurement variable underlying relates (z. B. device, users, time usage case) and the license metric then describes the exact shape of the measurement. However, this terminology has not yet been standardized.

License metric

The license metric indicates how the license requirement should be counted. Customary metrics take one or more of the following into account:

• Number of installations
• Operating system used, e.g. B. Databases that differentiate according to the performance of the operating system
• Number of named machines, if the license has a fixed reference to a specific hardware, e.g. B. OEM license
• CI ( Configuration Item )
• Number of named users
• Maximum number of users registered at the same time (see also concurrent user license model )
• Number of processors, sometimes further differentiated according to the number of processor cores
• Processor performance, e.g. via MIPS or MHz
• Number of locations where the software is used
• Number of network segments in which the software is used
• Duration of use (in specified unit)
• Use process ( Pay per Use , Software as a Service )
• session
• Data volume (in specified unit)
• Used versions from a list
• Access authorizations, e.g. B. Microsoft Client Access Licenses ("CAL")
• Groups of functions of a software
• Used tokens (see also token-based license model )
• u. v. a. m., often combinations of these metrics

Many licensors offer several versions of the same software in order to better meet the demands of the market.

Levels of license management

License management is divided into the following stages:

1. Determination of the installed software in a database , this step is often called software inventory and the result is called software inventory. The prerequisite for this is that the software operating devices are known.
   • This requires the identification of the commercial software product including its version on the basis of the features found.
   • This license requirement may have to be supplemented by technically undetectable access rights ( Client Access Licenses ).
2. Determination of the existing licenses in a database (this step is often also called license inventory and the result is called license inventory )
   • This requires the interpretation of the existing contracts, possibly also of contract combinations, taking into account the product versions currently available on the market.
   • Special rights and obligations may have to be taken into account
     • Upgrade / downgrade rights
     • Multiple usage rights of one user
     • Reporting or registration obligations
3. Compliance Check (engl. Compliance : Compliance): Balance software inventory with the license inventory, so a check whether there are licenses for the software installed (it is also called creating a license balance).
   • result of the test
     • License coverage or over-licensing : There are more licenses than software deployments or installations.
       • Depending on the degree of over-licensing, this can mean economic damage to the company.
     • License underfunding or underlicensing : There are fewer licenses than software deployments or installations.
       • Depending on the license agreement, certain deadlines can be agreed for the compliance check, outside of which no check is required. If such reference dates are not expressly agreed, a continuous compliance check is required.
       • Any underlicensing that is or can be identified during a required compliance check constitutes a license violation.

Different hardware as well as different operating systems and networks must e.g. B. be taken into account when recording the installed software. When the licenses are recorded, there is often a lack of processes to store licenses in a regulated and structured manner. Responsibilities need to be clarified. When setting up the database, the mapping of the organizational structure with the different levels of business areas and cost centers plays a role.

Due to these far-reaching requirements, license management usually also includes:

• Guidelines , work instructions and processes
• Clarification and allocation of responsibilities
• Requirements planning and procurement
• Organizational commitment by management (especially purchasing, IT , controlling )

Furthermore, license management includes a precise examination and structuring of the existing licenses - contract management . Software contracts offer a wealth of opportunities (e.g. information about when an update is free of charge), but also risks for the company. Within the contract management, this data is recorded (usually also in a database) and thus made accessible for general planning.

Depending on the size of a company and the variety of software products and versions used, the use of special license management software may be necessary for the correct and economical implementation of software license management . Management can also be outsourced to service providers such as SoftwareONE .

Purpose of license management

• License costs that can be planned and scaled appropriately for the business purpose on the part of the licensee.
• Simplified installation and maintenance of systems if the licensor provides other software versions.
• Accounting for license "reserves" in order to reduce license surplus or deficit and to measure the value for accounting for the company (for example in fixed assets ).
• Reduced risk for the management through non-license-compliant installations.
• Conscious use of software as a resource leads to a more needs-based distribution of software, and shelfware (unused software) is avoided.
• Financial and tax law aspects:
  • Not only the processes of requirement planning, procurement, administration of licenses, data determination and license balance preparation have to be considered and designed within an overall concept of a company-wide license management, but also financial and tax law aspects.
  • So book z. For example, very few companies uninstalled or scrapped software from their systems. This means that an overall higher balance sheet inventory is carried and taxed than is actually available.
  • In addition, tax law aspects must be taken into account when reselling software, especially between related but economically independent parts of the company. The arm's length principle generally applies here :
    • Transactions between affiliated companies are also to be designed for "used" software as they would have come about under the conditions of the free market. A certain surcharge must therefore be added to the license price.
  • In addition to taxes, aspects of commercial law must also be observed if, for example, B. larger license packages are sold to affiliated companies abroad. With high import taxes and time-consuming bureaucratic hurdles, it may be advisable to purchase software directly in the country of use or to conclude contracts there.

See also

• Multiple licensing

literature

• Jan-Armin Reepmeyer, Frank Bensberg: License management in local networks - legal principles, organizational concepts, software tools . In: Business Informatics. Vol. 36, No. 6, 1994, pp. 591-599.
• Torsten Groll : 1x1 of license management. Practical guide for license managers. 2nd Edition. Hanser Verlag , Munich 2012, ISBN 978-3-446-42659-7 .

Individual evidence

1. ↑ See press release No. 94/12 (PDF; 49 kB) of the Court of Justice of the European Union of July 3, 2012 in the case C-128/11 UsedSoft GmbH / Oracle International Corp
2. ^ LG Cologne, judgment of September 14, 2011 , Az. 28 O482 / 05, full text.
3. ↑ See principle of exhaustion of the Federal Court of Justice
4. ↑ See 1x1 of license management , p. 42
5. ↑ See 1x1 of license management , p. 44
6. ↑ See 1x1 of license management , from p. 46