The Brightwork Research Software Licensing Guide

Executive Summary

  • We are the only research entity that provides non-financially conflicted software licensing consulting.

What is a Software License?

To begin, in understanding software licensing, let us review what is the software license.

A software license is a legal instrument (usually by way of contract law, with or without printed material) governing the use or redistribution of software. Under United States copyright law, all software is copyright protected, in both source code and object code forms, unless that software was developed by the United States Government, in which case it cannot be copyrighted.

A typical software license grants the licensee, typically an end-user, permission to use one or more copies of software in ways where such a use would otherwise potentially constitute copyright infringement of the software owner’s exclusive rights under copyright. – Wikipedia

The Categories of Software Licensing Consulting Firms

It is crucial to consider the different categories of companies that offer software licensing consulting services.

Type 1: General SAP Consulting Firms

Companies that perform SAP implementations like Deloitte, Accenture, or Infosys like to present to be independent advisors. However, each of them has long-standing partnerships with SAP. They are recommended to new customers or clients through SAP, and SAP can choose which consulting company to reward, and therefore has a great deal of power over its consulting partners. All SAP consulting firms value their relationship with SAP more than any one individual client.

SAP consulting companies try to "lightly advise" companies and generally stay out of the way. Less they are viewed by SAP as working against SAP's interests.

Therefore, software buyings that rely on SAP consulting firms end up with nothing but fake negotiation support. SAP consulting firms are always aligned with SAP interests over their client's interests.

Type 2: SAP Software Licensing and Negotiation Firms

These firms focus on negotiating software deals and sometimes do consulting work.

These companies usually focus not on the technology but on getting the best price for what is agreed upon to be purchased. Their specialty is knowing the counts of the licenses needed by the client and then optimizing them and optimizing their price. In a dispute between a customer and a vendor, they can use software to determine how many licenses are actually being used and compare them to how many licenses were paid for.

Our objective in explaining this type of company is to describe how we differ. We have subcontracted to these companies in the past, and they try to present our research as their own. However, as they don't know our area, it is a bad value for the client. Their focus is primarily on reducing acquisition costs, and some of these companies are paid a percentage of the costs that they save the client.

Our Niche in Software Licensing Analysis

We are a research firm leveraging this research to support software licensing disputes between software buyers and software vendors/partner consulting firms. These disputes are generally related to how the software ended up being used versus how it was expected and promised the software vendor and the partner consulting firm would use it.

We analyze the licenses that were sold, review the requirements and needs of the software buyer to determine if the software vendor supported by the partner consulting firm knowingly oversold licenses for used software products and sold software products that the software vendor/partner consulting firm would have known could not be implemented or otherwise would not be used.

About Software Licensing Usage Analysis

  • There is frequently deliberate “stuffing” of software bill of materials by vendor sales teams.
  • Often, the software vendors position themselves between being a salesperson (which is what they are) and being a “trusted advisor.” They will correspond with their customers by saying they “recommend” a certain number of software products and licenses without ever acknowledging that they are incentivized to sell as many products and as many licenses as possible.
  • This stuffing of the software bill of material with what ends up being unused licenses is common, particularly among the most prominent software vendors.