One in three SME liable for huge fine as breaking the law through software mismanagement

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According to the study commissioned by BSA | The Software Alliance, the leading global advocate for the software industry, nearly a third of UK small businesses have admitted to installing software onto more PCs than their licence agreement allows or using the wrong kind of license for their organisation, (for example an academic licence in a commercial environment).

Cost cutting is a major incentive for infringing copyright law. Another 30 per cent of businesses would buy the wrong kind of licence to save money.

However this could be a false economy as unlicensed software use often leads to enforcement action as the BSA regularly takes legal action against companies for unlicensed software use resulting in hefty fines.

Michala Wardell, UK committee chair, BSA says: “It’s shocking that almost a third of small businesses are infringing the Copyright Act when it comes to managing their software. And simply bewildering that many of these businesses don’t change their software management practices until they face a legal challenge. Given the costs involved, you’d think the job of sorting out software licences would be a priority from the word ‘go’.”

The research suggests that growing businesses are particularly likely to have too few licences for their software. Well over a third (39%) of businesses surveyed often allocate additional PCs and software to employees before paying for additional licences.

Last year, safety specialist First Choice Facilities Ltd paid damages to the BSA as well as purchased valid licences, amounting to almost £100,000, after acquiring another company and allegedly inheriting a substantial amount of unlicensed software. This came to light following an informant’s tip-off.

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