The Internet commercial begins with a pounding rhythm as you watch an everyday-looking man being escorted down a prison hallway. The baritone voice-over booms, “The faces of software piracy.”
This is an ad for the Business Software Alliance, a group of lawyers focused on prosecuting the abuse of software licenses.
“It’s the doctors who are liable for this in a practice, though, not the office administrator or the staff. And no one may even be aware they’re making this mistake,” says Russ Dorsey, CEO of Integrated Solutions.
Software purchased through vendors generally holds little potential for abuse for practices. “Our practice management and electronic health record software is self-policing,” says Nancy Ellis, vice president of MediSYS. “We install it and set up the providers as part of our support function. Even if they installed the software themselves, it would require they access a link to activate it.”
“We don’t have license abuse problems,” says Ryan McGinty, CEO of Oceris, the makers of FlexMedical. “Our product is based on per doctor as a billable entity. They can’t bill to a new physician unless they contact us. It makes a natural kind of barrier.”
Most abuses occur with off-the-shelf software, like Microsoft Office. A practice manager takes someone’s advice that they need 20 copies of Office and heads to an office supply store to buy it. But they don’t realize that some versions, once installed, cannot be transferred to another computer.
“Don’t buy software that’s tied to hardware, period,” Dorsey says. “That software may be good for seven years, but the hardware’s only good for three.”
This is the difference between Open licenses and OEM licenses. Open licenses are the “good” kind that allow software to be legally removed from one computer and installed on another. OEM licenses are the “bad” kind. They legally adhere the software to that one machine.
“I’ve never dealt with clients who didn’t want to do the right thing. The problem is knowing what the right thing is,” Dorsey says.
Some computers, like some Dell versions, come with Office installed. Same problem. “A lot of people think, ‘I bought another Dell, so I’ll just move my software over. But that’s not legal,” Dorsey says.
“And to further complicate things,” Dorsey says, “for big organizations where they pay annual fees and rent servers every year, there’s server licensing.”
Growth can catch a practice off guard as well. They need to be conscious of whether they buy a per workstation, per user, or per server license. If a practice with user licenses expands from 15 staff when the software was purchased to 30 people three years later, it’s now in violation even without buying additional computers.
The new push on the Internet and radio by lawyers and software firms stirs up potential for disgruntled employees to take action. Business Software Alliance’s online commercials encourage any employee to report suspected license abuse at their company through the ease of an Internet form or by calling a hotline.
More licensing cases also mean new case law on the books, easing the way for software companies and attorneys to cite precedence. This elevates the risk in any business.
Protection lies in a regular software license audit. Just like accounting firms encourage an annual, third-party audit of the books, practices should bring in a third-party IT company to audit for software compliance.
During an audit, an IT firm scans the network for software packages, license types, and usage. Using the practice’s license documentation, they can determine any potential risks or violations. The results arrive as a private report, as with any audit.
Every practice needs a central location for storing the physical licenses for the entire practice. That folder deserves the protection of a fireproof, flood-proof cabinet. “An administrator needs to be able to put their hands on the actual physical licenses. That’s like holding cash. Like taking a wad of money and setting it in a room,” Dorsey says.
Software licenses, warns Dorsey, are not stored on the computer or on the receipt from the store. The official license is the sticker from the vendor with the hologram and the bar code, usually on the box or sometimes on a separate paper inside the box. For downloaded software, the key may be emailed. “If you bought $10,000 in software and threw away the boxes or those keys, you threw away the licenses,” he says.
Registering online when the practice purchases the software also adds a layer of protection. The manufacturer now holds proof that the purchase occurred. This is useless if done under a vendor’s name, though, rather than the practice’s.
The practice also does not want to rely on a vendor to gain access to their license. “If you’ve registered online, and there’s ever a fire or storm, you want to be able to reach that information quickly,” Dorsey says. “It also means you can replace that software, and it won’t cost you a penny, because your key is online.”