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Maximising the Advantages of Escrow Services

Many companies are now taking advantage of the improved technology to maximize the use of various software solutions. This has necessitated companies to license different software to meet their technological needs. The software tends to be very expensive, and it is important for both the licensor and the licensee to protect their investments. As such, escrow services have been very critical for software developers because the help protect the interests of both parties. Software escrow involves depositing the source code of the particular application with a third party. The escrow agent is the third party in this case, and he is supposed to impartial so as to ensure the rights of both the licensor and the licensee are guaranteed. Indeed, the source code escrow is a very important part of vendor agreement, and both the licensor and licensee have the right to initiate it.

Software is available in two formats, that is, the object code format and source code format. As a licensee, you only get the object code format while the escrow gets the source code for safe keeping. Deposing the source code with the escrow agent ensure that the software is updated and maintained on a regular basis. This is very important for the licensee since the software may be a key part of their business and this cushions then from possible losses. Source code escrow services protect the business using the application for any event including the bankruptcy of the developer which may terminate some services. Under the escrow agreement, the developer, has the responsibility to maintain and offer support to the licensee based on the agreed terms and if this is not fulfilled, the licensee has the right to acquire the source code.

Source code escrow also benefits the software developer by protecting their intellectual property rights. The software industry has so many people who lack the creativity to create something new which discourages the developers from sharing their source code with the licensee. Source code escrow is anchored on various terms and condition which bind both parties. There are also numerous obligations for both parties. If any of the parties fails to observe these agreements, there are certain consequences. The source code escrow agreement outlines possible use or transfer of the source code which is key in protecting the rights of both parties.

Apart from storing the source code, the escrow agent has to authenticate the source code. It is also the role of the escrow service to ensure that the software is in good shape and that it offers optimal performance to the licensee. It is always advisable for a licensee to use escrow services if the software supports a vital function of the organization or has a direct impact on the revenue. Some software is also very expensive which makes it prudent for the licensee to use an escrow service to protect their interests.