5 Signs You'll Face A Software Audit

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Software vendors have automated ways to monitor usage of their products, and the larger the company, the more they pay attention to "red flags" that it may be time to run an audit, says IDC's Amy Mizoras Konary. Here are five customer events that Konary says can tip a vendor to do a software audit:

1. Your company is involved in a merger or acquisition. Things can get messy amid such consolidations. Companies might consider calling in software vendor compliance teams for help in sorting out what software is licensed and needed, and what new buying discounts they might get.

2. You're doing virtualization and private cloud deployment. Get a clear understanding of virtualization licensing terms before you start spinning up virtual instances. Unaware administrators can scale up your licensing obligations in a hurry if you're not careful.

3. Your company is growing but not buying more software. "In some situations the sales rep may say, 'They've grown a lot' or 'They did this particular deal, so we should audit them because they should be spending more money with us,'" Konary says.

4. Your top licensing expert leaves the company. Just when you're ill-prepared to document and defend your compliance position, don't be surprised if that's when the audit letter arrives.

5. You're not managing your licensing position. If you betray uncertainty in dealing with software vendors or, worse, defiant-but-vague confidence that you "must be overspending," don't be surprised if those vendors want to verify your compliance position.

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Software Licensing: Move From Defense To Offense

Cloud Won't Cure Licensing Woes

Get the entire Sept. 2 issue of InformationWeek -- no registration required.