Software licence warning

Companies involved in mergers and acquisitions or experiencing high levels of growth should make sure that their software...

Companies involved in mergers and acquisitions or experiencing high levels of growth should make sure that their software licences are fully maintained, warned a leading technology lawyer.

The warning comes after Manchester-based debt management firm Baines & Ernst last month settled out of court for a five-figure sum with the software suppliers' watchdog the British Software Alliance (BSA).

Sîan Croxon, a partner at City law firm DLA, said, "If companies are growing quickly or acquiring lots of smaller companies, there is little time to stand back and think and the issue of software licence compliance is one that is easily pushed down the agenda.

"The majority of companies that fall foul of software licence audits don't do it intentionally," he said.

Croxon said that licensing problems are more likely to arise in companies that do not have adequate IT representation in the boardroom.

Charles Howson, chief executive at Baines & Ernst, said the company lost track of its software licences because of the extraordinary growth it experienced.

"We are the fastest growing company in the North-west," said Howson. "Five years ago we had half a dozen employees now we have over 500. Obviously with this level of growth our primary concern was dealing with customer enquiries."

Howson said problems arose when MS Office licences sitting on PCs used by call centre staff were not renewed. Busy managers at the company were also unable to prevent staff downloading software from the Internet.

The company has now employed several senior managers to ensure that it does not fall foul of the licensing rules again.

"It needs to be given as much importance as any part of the business," said Howson.

Read more on IT for small and medium-sized enterprises (SME)

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