Education institutions risking huge fines from software vendors says License Dashboard

Further education and higher education institutions are at risk of receiving large fines from their software vendors due to errors in the management of licensing for the software they use for both staff and students.

Over a fifth (22%) of further education (FE) and higher education (HE) institutions do not currently have an adequate software asset management strategy according to research undertaken by Eduserv on behalf of License Dashboard*, a global software license management platform.

The study, undertaken amongst IT decision makers within FE and HE institutions, revealed that those who do not have full visibility of their IT estate greatly increase the likelihood of staff and students using unlicensed software, leaving them at risk of large fines.

With around 545 HE colleges and universities across the UK**, that is approximately 120 institutions at risk of facing serious financial consequences, according to License Dashboard – a penalty that few can afford, but that all could prevent.

Software audits

There is currently a 68% chance of receiving a software audit from at least one vendor within the next 12 months***, but the research shows that almost half of FE and HE institutions have received no such request inside the last 18 months. Furthermore, less than a third have actually been audited within the last year. Software vendors offer discounted rates for educational use of their products, however usage agreements still must be met in order to pass an audit.

The outcomes of software audits in education in the UK are not well documented, but in one of the first cases reported in the United States, one school in Los Angeles received a $300,000 (£232,000) fine when they were audited. They also had to pay out a further $3 million to cover the missing licenses, and another $1.5 million to put a software licensing team in place.

Johnny Ellis, Group Director of License Dashboard commented “Without a record of all software deployed as well as all active users, further education and higher education institutions can’t possibly fully understand their IT estate. If a software vendor comes knocking – and they will – and finds software is being used outside of the predetermined user agreements, or without a user agreement altogether, it can cost thousands of pounds in fines for noncompliance. You’d be hard-pressed to find a school that can afford those sorts of unforeseen costs.”

Software asset management involves keeping a record of software purchases, usage policies, and updating these as software requirements change internally. If a software vendor requests an audit, a full and accurate inventory of all software in use and active users is required, and should correspond with that pre-agreed software vendor’s contract. Inadequate software asset management can commonly lead to:

  • Being under-licensed, which means HE and FE institutions would be at risk of non-compliance, and therefore a fine, in the event of an audit
  • Being over-licensed, which means HE and FE institutions would be at risk of wasting money on unnecessary, unused software

Ellis continued: “When an institution is audited by one software vendor, it often triggers a snowball effect whereby other vendors also jump on the bandwagon and target the same institution. This could be completely financial crippling for colleges and universities if they have not been compliant with their terms of agreement/usage agreement – but something they can all take steps to avoid.”

License Dashboard suggest institutions with concerns about software spend, vendor audits, and mis-managing their software licenses should take the following actions:

  1. Perform a full inventory gathering all software information including purchase records and usage policies, and cross reference against what is deployed and being used
  2. Ensure they are making the most out of their IT budget by taking full advantage of all discounts and offers from their software vendors.
  3. Consider implementing a SAM tool to manage software assets – there are providers that offer discounts for academic institutions.

License Dashboard products and services facilitate software asset management by helping to manage the full lifecycle of an organisation’s software. Through its partnership with Eduserv, HE and FE institutions keep a software repository containing product, entitlement, and usage data. This ‘Effective License Position’ highlights whether an organisation is under- or over-licensed, verifying compliance status at any time.

With HE and FE institutions predicting major changes in their IT environment in the next three years, including Outsourcing services and SaaS, virtualisation, and infrastructure modernisation, the way staff and students access and use software will be subject to serious upheaval. In order to remain compliant, these organisations must keep an accurate record of deployment and usage, and ensure it follows software vendor entitlement agreements.

– Ends –

Media Contacts

Ben Eagling

ben-eagling@licensedashboard.com

01904 562217

Notes to editors

*research undertaken by Eduserv on behalf of License Dashboard among 50 HE and FE institutes in September 2016

**list of UK Universities via wikipedia

**list of UK Colleges offering HE via wikipedia

***via Gartner’s Competitive Landscape: Software Asset Management Tools

About License Dashboard: License Dashboard offers a blend of homegrown Software Asset Management technologies and Software License Management expertise to deliver a powerful license management platform. Originally designed to run in-house, the License Dashboard platform has since evolved to run as both a fully managed service or an on-premise solution to give customers a full-view of their effective licence position (ELP). More information at www.licensedashboard.com

About Eduserv: Eduserv was founded in 1999 as a not-for-profit IT service provider that encompassed both Chest and OpenAthens. The first Chest Agreement, for engineering software, was set up in 1988 at the University of Bath and since then have expanded to encompass Online Resources, and have been opened up to include Further Education and associated organisations. More information available at www.eduserv.org.uk/chest

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Ben Eagling

Ben Eagling

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