Cloud compliance

The Cloud and Licensing Compliance: What You Need to Know

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In the “old days,” maintaining software licensing compliance may have been a bit time-consuming, but it wasn’t necessarily a difficult process to take control of. Someone that works for an organization – usually in a leadership position – would create a comprehensive inventory of all software installed within their IT environment that would then be compared against those apps that they were licensed to use. All necessary purchase documentation would be compiled and stored indefinitely, all so that you could essentially “prove” you licensed everything correctly.

This process helps create an invaluable level of visibility into an enterprise – not just from the perspective of showing whether you would pass an IT audit, but to also prevent IT managers or users from purchasing software they don’t need or renewing licenses for apps they don’t actually use.

But what happens when your software isn’t actually installed in your environment at all? What happens when those critical applications are delivered over the Internet in an on-demand capacity via a partner organization like a cloud services provider (CSP)? At that point, what role must your business AND your CSP play in maintaining licensing compliance?

Thankfully, this too is a relatively straightforward process. It simply requires you to keep a few key things in mind.

The Cloud and Licensing Compliance: Breaking Things Down

The most important thing to be aware of in terms of license compliance as your company makes the jump into the cloud is that the process itself MUST begin with a clear and thorough understanding of the agreements with your CSP that you are now subject to.

Indeed, this may be the number one responsibility of customers everywhere as if you don’t actually understand the terms, it will be difficult – if not impossible – to remain compliant with them. A violation of an agreement won’t just make a software audit a forgone conclusion – it could also expose your business to unplanned licensing costs, litigation and other scenarios you’d want to avoid at all costs.

This also requires you to understand how an agreement is defining a “license” in the first place – something that also falls on the clients, not the CSP. In the cloud, there are a few different types of licenses that you may deal with, including but not limited to ones like:

  • Enterprise licenses, which is when you purchase a single license for your entire business. All workstations and users would be covered under this one license.
  • Workstation licenses, which is when you need to purchase an individual license for every workstation that uses a particular piece of software.
  • Single user licenses, which are exactly what they sound like – licenses for each person that will end up using the software in question.
  • Concurrent use licenses, which is based on the number of people who will be simultaneously accessing the software at any given time.

Once you fully understand what licensing compliance means in your unique situation, you can then create policies that your employees must follow and design the types of processes that you need to support those policies. Employees need to be aware of the consequences of non-compliance and the improper use of software. They should know that they can’t share their login information with someone else, for example, and that they shouldn’t be accessing certain software on their personal computers (if applicable).

But the CSP also has an important role to play in licensing compliance in the cloud. The solutions they offer you should already be compliant at the start of your working relationship – particularly if they’re providing you with access to applications and other software assets that they don’t actually own and didn’t design.

In other words, both parties play a role in making sure that things are going along as they should be… and must work collaboratively to maintain compliance. Never assume that your CSP will handle 100% of the burden of licensing compliance. These are conversations and negotiations that you need to be having with your representatives early and often during your time together.

Yes, licensing compliance is something that users must be vigilant about – but the same is true of CSPs . Engaging your CSP provider and verifying enterprise wide compliance for the software delivered via the cloud will remove the guesswork from the equation. To that end, it’s really no different than something like HIPAA compliance in the cloud. If your CSP isn’t compliant, neither is your business – which means you should start looking for another partner sooner rather than later.

Outer Edge Technology: Because a Partner in the Cloud is a Partner in Compliance

At Outer Edge Technology, we understand that every business is unique – and that’s especially true when it comes to the industry-specific compliance matters that organizations have to contend with on a daily basis. That’s why we’ve always made it a priority to help people not only leverage the full power of modern technology to their advantage, but to do so in a way that keeps them and their own customers safe and secure at all times.

Thanks to the way cloud platforms are designed, they naturally allow people to focus less on compliance and related issues and more on the important work they’re doing on a daily basis – which is exactly the way it should be.

If you’d like to find out more information about the role of CSPs and their customers when it comes to factors like the cloud and licensing compliance, or if you’d just like to talk about your own long-term IT goals with someone in a bit more detail, please don’t hesitate to call 1-844-OET-EDGE or email

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