Why do you need Software Escrow?
Licensing software requires a tremendous degree of trust between both parties because there tends to be a great amount of risk involved. Developers have to trust that users will respect their intellectual property and not alter, corrupt or misuse the software. Users, or licensees, have to trust that developers will maintain the software’s full functionality both today and in the future. Confidence in a company’s integrity is important, but there is a big difference between trusting that everything will work out in the case of an unexpected event, and having a continuity plan to make sure that it will.
Software escrow delivers that continuity plan.
What is Software Escrow?
Software escrow, also known as technology escrow, is for both the developer and the licensee to mitigate risk when negotiating a software or technology license.
With a software escrow contract, the developer’s source code (or other technology/intellectual property) is managed in a secure escrow account held by a designated, neutral, and trusted third party. If the developer is unable to support the product in the future for reasons specified in the escrow agreement—such as bankruptcy, obsolescence, merger or acquisition—the licensee will be able to access the source code to keep their business up and running. The goal is to get the end user up and running whether the technology is on-premises or Software-as-a-Service.
Iron Mountain Software Escrow
Although roughly 80% of the intellectual property in escrow is for software, there are many contracts that protect assets like: design documentation, formulas, algorithms, recipes, non-source code based technology, and other proprietary materials that are managed by us until the conditions in their contracts are met and we are to deliver the materials to the appropriate party. As the company who commercialized the concept of source code escrow in 1982 – we still define the leading edge of the field today and continue to be amazed by the immutable benefits of escrow and the role of a neutral party in engendering trust.
By partnering with Iron Mountain, the world’s most trusted provider of technology escrow services, you’ll get the infrastructure; resources and expertise you need to protect your vital assets and preserve the integrity of your intellectual property.
Explore our solutions:
SaaS Escrow - Cloud
Most companies today rely on SaaS solutions for one or more vital aspects of their business. As a subscriber, the benefits of SaaS are hard to ignore, but cloud-based software is not without risk. As a SaaS provider, you realize these risks give subscribers pause. Can you credibly answer questions about what happens to your customers’ applications and data if your code gets corrupted or your company goes under?
What if you could…
- Safeguard your business with a comprehensive SaaS protection solution?
- Ensure access to data and applications for your subscribers?
- Gain confidence, knowing that you are prepared for any contingency?
- Drive more revenue by addressing the real concerns?
Get Help Navigating Software through the CloudIron Mountain offers complimentary consulting services to assist our clients with the planning and implementation of SaaS technology solutions and best practices for application continuity and contingency planning.
Four Levels of Escrow Verification
In the event of an escrow release, verification enables you to effectively read, recreate and maintain your developer’s technology in-house- or transition smoothly to another vendor. Without verifying what is in your escrow deposit, you could find out too late that your escrow release is useless.
Iron Mountain’s trusted escrow verification services offer unrivaled insight into the composition of your escrow deposits through a four level approach to verification:
- Level 1 Inventory and Analysis Test — Provides a complete audit and inventory of your deposit, including analysis of deposited media to verify the presence of build instructions and identification of materials necessary to recreate the original development environment.
- Level 2 Compile Test —Validates whether the development environment can be recreated from the documentation and files supplied in the escrow deposit.
- Level 3 Binary Comparison Test — Tests the functionality of the compiled deposit materials by comparing the files built in compile testing to the licensed, executable file running at your site.
- Level 4 Full Usability Test —Confirms that the source code placed in escrow will be fully functional in the event of a release. We run a series of tests to ensure that replicated software runs properly and then create a detailed report of these tests, which includes demonstrations of the functioning software in action
Complementing your software escrow arrangement with verification services will help you verify all the pieces of your escrow deposit will work together as needed.
Intellectual Property Protection
Protect Your Intellectual Property Development
Your business relies on the intellectual property (IP) you develop to remain competitive in the marketplace. Your intellectual property is at the core of your company. But, as crucial as IP is to companies like yours, it is often poorly managed as an asset.
Ensure the integrity of your IP, and your company’s wellbeing, with IP Development Protection. Prevent others from using your inventions, designs or other creations. Make sure you’re the only person who can monetize or profit from these assets. Theft and illegal use of IP is widespread and results in lost opportunity, unrecovered costs and expensive legal battles.
What If You Could…
- Document IP development with a timestamp/audit trail that is securely held with a neutral, third-party?
- Strengthen your company’s position in the event of an IP dispute with a business partner or during a merger or acquisition?
- Safeguard you intellectual property if an employee leaves to work for a competitor?
With Iron Mountain acting as a neutral, trusted third party that protects and manages your IP, a secure technology escrow deposit can be used to document the development of your company’s IP. With our Intellectual Property Development Protection Agreement (IPDPA) we date and time-stamp each deposit so a genealogy of the product is kept on record. Our IPDPA service can provide necessary key evidence of when, how and by whom a technology was developed at a point in time. This independent preservation of your IP by Iron Mountain can significantly strengthen a company’s position in any legal dispute concerning intellectual property rights.
Discovery Escrow - for Litigation
Easily Satisfy Your IP Litigation Discovery Requirements
During the discovery phase of litigation, there is an inherent conflict of interest between parties. Defendants must satisfy the discovery requirements of the court, while simultaneously protecting their intellectual property. For plaintiffs, it’s essential that their attorneys and experts gain access to the information necessary to prepare for trial. Our expertise empowers organizations to comply efficiently with discovery compliance provisions related to intellectual property litigation, while simultaneously reducing associated costs, response times and risk of potential exposure.
With Iron Mountain acting as a neutral third party in the discovery process, the IP Litigation Discovery Escrow Service provides a secure and controlled environment that benefits all parties:
- Plaintiffs are allowed the opportunity to access and examine all pertinent intellectual property
- Defendants eliminate the potential exposure and risk associated with delivering proprietary information directly to plaintiffs
- All parties enjoy access to mutually agreeable, convenient locations via Iron Mountain’s extensive national network of secure data protection vaults
- Comfortable working environments—with onsite customer service— where proprietary deposited materials can be reviewed
- Flexible security protocols to meet the specific needs of each individual case
ICANN Data Escrow - Registry/Registrar
Iron Mountain offers the most comprehensive and trusted Domain Name Registry Data Escrow Services in the industry. We make it as simple as possible to comply with ICANN’s escrow requirements. Plus, we’ve been escrowing registry data since 2001, so we know the ropes.
Registrar Data EscrowIn 2007, Iron Mountain was selected by ICANN to function as its Registrar Data Escrow agent. This program is designed to help ensure the stability and security of the internet’s domain name system through escrow of critical gTLD registration data, ensuring that the information associated with registered domain names is never at risk. Registrar Data Escrow protection serves as an under-the-radar safeguard, ensuring the continuity of service across the internet and delivers peace of mind to ICANN and domain name registrars worldwide.
Registry Data EscrowIn many cases, new gTLD applicants will be assisted by Registry Service Providers during the application process — they may also manage the ongoing operation of your registry. Iron Mountain has partnered with several Registry Service Providers as their preferred escrow agent. We can work with whichever Registry Service Provider you choose.
To learn more about how technology escrow can benefit you, click on your role below:
Software Escrow for Developers
Critical Business Issues for Developers
• I need to close the deal. With the right escrow agreement, you’ll offer the investment protection assurance your customer needs to feel comfortable making the deal.
• I need to assure my customers that I’m a safe choice. Technology escrow will reduce your customers’ risks of licensing software and, consequently, help to ensure their business continuity. You also can and should escrow your most critical technology as well to mitigate risk in your supply chain.
• I want to protect my intellectual property. Protecting your intellectual property is of the utmost importance. Simply turning over your code to customers is not an option because if your code is compromised in any way, you’ll lose your competitive advantage and miss out on new business opportunities.
Confidence, Security and Protection
As a technology developer, you want your prospects, customers and partners to have confidence in your company. Establishing sound escrow processes helps you to instill trust into your solutions by letting a trusted and secure third party handle the process rather than try to do it yourself.
Partnering with the leader of integrity and success in the escrow industry for the last 35 years will add significant value to your solutions by safeguarding your customer’s investments with Iron Mountain technology escrow and verification services.
Additional Resources :
- A Developer’s Guide to Escrow
- Eliminate Business Hurdles with Software Escrow (Video)
- Software Escrow Workflow
- Software Escrow GitHub Integration
Software Escrow for Licensees
Critical Business Issues for Licensees
•I want to leverage the latest technology to run my business, but the developer is outside my control. Leverage the escrow relationship to ensure your developer lives up to its promised service levels and protect your monetary investment so you can invest in the technology you need to stay on top of the competition.
•I need to make a safe technology decision. Eliminate any concerns about the developer’s capabilities or the quality of your technology. Maintain access to the application source code, as well as a complete set of deposited materials, so that you can keep your business up and running. Our full range of technology escrow and verification services ensures that your software works when you need it to.
•I need to adhere to my company’s risk mitigation strategy. Most likely, your organization has proper processes for you to follow in order to reduce the risk of bringing new technology in house.
Protect against the unknown when your company licenses on-premises software or subscribes to a Software-as-a-Service (SaaS) application, you rely on your vendor for technical support, functional enhancements and maintenance. With SaaS applications, you entrust your data to them as well. This dependency exposes your company to risks.
What would happen if your vendor went out of business or otherwise stopped supporting your software or technology? Your company could suffer considerable losses in revenue and/or productivity. Whether your developer is large and trustworthy or small and without a proven track record, you need to know that your technology will be there when you need it.
An Iron Mountain escrow account gives you leverage by allowing you to access the source code and other proprietary information that you need to keep the technology (and your business) up and running.
The Law Firm Advisory Role in the Technology Transaction
CRITICAL BUSINESS ISSUES FOR LAW FIRMS
- I need to help my clients reduce risk. Reduce risk and enhance compliance for your clients through integration of technology escrow and verification services as part of a comprehensive risk management strategy.
- I want to recommend the best. Iron Mountain has provided software and technology escrow protection for software and technology vendors and their clients since 1982. Plus, we’re the only Fortune 500-company in the technology escrow business. Entrust your clients’ interests to the acknowledged global leader in the field.
PROTECT YOUR CLIENTS
Whether your clients develop or license software, you have a legitimate interest in helping them assess the risks of doing business and giving them expert advice.
Law firms should recommend escrow protection to their clients if:
- the software or technology is mission-critical to the client’s business, and not off-the-shelf
- many employees rely on it
- the technology impacts the client’s customers
- the technology is costly to replace
Iron Mountain’s suite of escrow and intellectual property management services protects software users and buyers by providing a range of services. At a minimum, we can offer access to their developer’s source code and maintenance materials under specific conditions in the escrow agreement or we can fully replicate the application and data in a stand-alone environment.
Contact Iron Mountain
Our Customer Support section can help provide you with the quickest answers to your questions, or feel free to contact us at your convenience.