Software escrow - introduction

This simple guide helps you make software escrow decisions for your business, from "What is software escrow" to what should be in a software escrow agreement.

Software vendors provide software to businesses like yours. By "you" I mean your business running software supplied by one or more independent software vendors. They give you access to the object code (the executable computer programs and supporting data) that are required for the software to run correctly. But the vendor will typically not give you free access to the source code and detailed technical documentation for that software. They view that code/documentation as proprietary and confidential.

However there are circumstances when you reasonably want access to the source code and documentation e.g. if the vendor goes out of business or for any other reason can not fulfill an obligation to provide the source code items.

A common solution is for the software vendor to place the source code in the hands of a specialist third-party - the software escrow services business. That business retains the source code and releases it to you under circumstances pre-agreed in an escrow agreement which both you and the software vendor sign. The software vendor knows you do not get access to the source code without good reason. You know you get access to the source code should you really need to. The escrow business meets a market need by providing the 3rd-party escrow service.

Organization in software escrow
Benefits of software escrow process
You - the user of the software. Also called: beneficiary, licensee, subscriber.
You get access to software source in pre-agreed exceptional circumstances - even if the vendor is no longer able to fulfill contractual obligations.
The vendor of the software. Also called: supplier, depositor, licensor, developer.
Your comfort regarding access to the software source. Reasonable assurance that the source will not be released in a manner that is not the interest of the vendor.
The third-party escrow business. Also called: escrow agent, escrow provider.
Revenue from providing a cost-effective service with a contract and some supporting legal and technical advice.

The rest of this site looks at the factors you (the software user) should consider when looking at a software escrow agreement.

I have worked in IT for 30 years and have several degrees. I have a great deal of experience dealing with 3rd-party software applications and issues surrounding application source/object code.