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What is software escrow?
April 23, 2013
A software escrow agreement is a form of protection for both creators and users of valuable software applications and rather like insurance or RAC membership,’ you don’t need it until you need it’, and on that basis it is better to have it and not need it, than to need it and not have it.
The modern world needs software, practically nothing could operate without it, and creators of software are creating items as valuable as works of art. Which as we all know need protecting and insuring. An escrow agent becomes a third party to the main agreement and in effect ’keeps a copy’ to protect both the main parties in the event of something going wrong.
As with items of artwork, software applications can become broken either by accident or ineptitude or simply because they are technical and anything technical can go wrong!
What would happen if something technical went wrong in your world of business or pleasure?
First thing contact the software provider and find out if they can help.
Oh dear!! They closed down six months ago. Total panic!
What next, call in expensive help?
• Can they help?
• can they fix it,
• what will it cost,
• how long are you ,’out of the game’,
• staff confused,
• customers confused,
• Vital time, energy and money lost.
These are just some of the problems that can arise when relationships with software suppliers breakdown.
Software escrow agreement have been used for many years to mitigate these risks and make sure that if a catastrophic event does occur you are not left high and dry, which in most cases as researched by Gartner, means that 60% of business that have a critical IT failure go bust within 12 months. A software escrow agreement will go some way to stopping this happening and give you the control in a situation that would usually be way out of your control.