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Are You Sure Your Business Software is Legit?

By Mae Kowalke, TMCnet Contributor

Businesses generally assume the software they purchase from resellers is genuine. The numbers show that many businesses are wrong.

Fully a third of all software sold is actually counterfeit despite being marketed as legitimate, according to IDC (News - Alert).

The numbers are so high partially because it is hard to spot counterfeit software; unused license keys do not automatically make software legitimate.

Further, legitimate software might be sold in violation of a license agreement, such as in the case of educational editions that are not intended for business use.

A second assumption that can be dangerous is that the reseller is the liable party in such cases. Again, this is wrong; the Copyright Act puts the burden on the business to prove that its software is legitimate, not the reseller. So if a business purchases counterfeit software or is not using it according to its license agreement, it will be on the hook.

The best defense against software licensing issues is, of course, to purchase only from a reputable source. Know thy supplier or—better yet—purchase directly from the company that makes the software.

Another key is recognizing when a discount is too good to be true. You get what you pay for, and if software is marked down more than 10 percent off of the manufacturer’s suggested retail price, something probably is amiss.

Pay close attention to original equipment manufacturer (OEM) editions. One way that businesses often fall afoul of license agreements is via the use of OEM editions that were purchased as standalone software.

OEM editions are almost always licensed for use only as software pre-installed on particular hardware. They should never be purchased as standalone software suites. If your software is licensed as OEM and it was not purchased in conjunction with hardware, there should be a big red flag that this software might be falling afoul with license agreements.

Of course, it is hard to turn down a deal. But businesses cannot play loose and fast with their software licensing. Software audits are on the rise, and some of the most aggressive companies in terms of license enforcement are business favorites such as Microsoft and Oracle (News - Alert). While consumers often can get away with pirated software, businesses need to tow the line.