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IBM audits: complicated and getting nasty

Oct 22 2014: Published by under Compliance,IBM,IT Asset Management,Software audit

IBM audits are never welcome, but they are increasingly becoming part of the norm. Why? IBM has targeted software to comprise 50% of its total revenue by 2015– this growth is not from SoftLayer or Watson’s cognitive computing alone.

In the past, long-time IBM customers who have been audited felt that they did well even if they needed to true-up. Things have changed. The settlement process has taken on an adversarial tone with repeated threats of theft of intellectual property, rather than a civil discussion regarding usage and a straightforward cost for over deployed licenses plus two years back support.

IBM insists it could ask for a settlement in excess of current usage if its licensing measurement tool is not in use, and then applies some shady methodology called ‘sharing the burden’. However it’s presented, the settlement amount is in excess of a straight true-up and may include a new license purchase unrelated to the client’s current usage but bundled as part of the settlement. The client is prevented from settling without the new license purchase which by itself could financially exceed the true-up license cost multiple times over.

It may be a company will not be subjected to this new audit method. Or, a company could be a fully compliant IBM customer that runs ILMT or a Tivoli tool, looks at the reports for accuracy, and if a purchase was necessary will make the purchase. If a company is IBM loyal, perhaps there is a deeper understanding of IBM’s licensing language. With all that said, in today’s enterprise, with the vastness of IBM products and its aggressive auditing techniques, it’s not impossible to remain compliant, just complicated.

Study: Microsoft Is #1 Software Auditor

Jul 16 2014: Published by under Microsoft,Microsoft Enterprise Agreements,Microsoft Licensing Compliance,Microsoft Licensing Tip,Microsoft Software Assurance,Microsoft Windows,Microsoft: News You Can Use

Flexera and IDC conducted a survey of 1,828 software and enterprise executives and found that 58 percent of respondents reported getting audits from Microsoft within the last year.

Following Microsoft in audit frequency were:

  • Adobe
  • IBM
  • Oracle
  • SAP
  • Symantec

Microsoft is now the top issuer of software audits for the second year in a row (this same survey is conducted annually). The survey also stated that 63 percent of respondents reported receiving audits in the last 18 to 24 months. Only 17 percent of the total respondents indicated that they had “never been audited.”

Those odds are not in favor of escaping an audit – best to be prepared!

Miro Consulting at 2014 World of IT Financial Management!

Jul 10 2014: Published by under Compliance,Contract Lifecycle management,Contract Negotiations,Cost Containment/Negotiation,licensing,Microsoft,Microsoft Licensing Compliance,Miro News,Oracle Licensing Compliance,software asset management,Software audit,software license

Next week, Miro’s Tim Hegegus will be presenting at the 2014 World of IT Financial Management on Optimizing Software License Investments. If you happen to be attending or in the area check it out! More details below!

2014 World of IT Financial Management 

Session Title: Optimizing Your Software Licensing Investment

WHO: Tim Hegedus, Senior Managing Analyst, Miro Consulting

WHEN: July 18th @ 1:00 PM

WHERE: Dearborn Inn, a Marriott Hotel
20301 Oakwood Boulevard
Dearborn, MI

DETAILS: Every organization faces common challenges with software licensing including how to optimize licensing; how to decrease spend, and how to avoid over and under licensing. Software vendors create such complex licensing and compliance rules, adding to the challenge.
Miro Consulting’s Tim Hegedus will discuss:

  • Microsoft, Oracle and IBM licensing types and key areas of difficulty
  • Future changes in licensing
  • Negotiating better terms
  • Proactive software asset management
  • License rebalancing & compliance
  • Support & renewals
  • 3rd Party Support

Another day, another BSA fine

Jun 26 2014: Published by under Compliance,Software audit,software license

The BSA just found an engineering design company to be non-compliant with their Autodesk software –  resulting in a payout of over $50,000.

The company, Project Options Ltd, was outed by a “confidential online report” that was submitted through the BSA website.  Likely a disgruntled employee or perhaps even a competitor.

The fines, which added up to over $50,000 included fees for new licensing they had to purchase. The company has said before being discovered by the BSA, software licensing was not a priority. Not only did they find a licensing gap – the audit by the BSA discovered that some of Project Options’ contractors had downloaded and used unlicensed software – woops! 

The good news? Software licensing is NOW a priority for this company – and hopefully others will learn from their mistakes!

Compliance or Cost Reduction?

May 02 2014: Published by under Microsoft,Microsoft Licensing Compliance,Microsoft Licensing Tip,Microsoft: News You Can Use,Miro News

To quote iQuate Founder and CTO Jason Keogh after a quick polling of a webinar audience about which is more important during a Microsoft True-Up – compliance or cost reduction…

“I’ve got good news for you if you answered compliance. Compliance is easy – just write a big check.”


Two Upcoming Webinars – Microsoft and Oracle Live Q&As – Sign up now!

Mar 03 2014: Published by under Microsoft,Microsoft Licensing Compliance,Microsoft Licensing Tip,Microsoft Software Assurance,Microsoft Windows,Microsoft: News You Can Use,Miro News,Oracle license,Oracle Licensing Compliance,Oracle Licensing Tip,Oracle: News You Can Use,Software audit,software license

Sign up today for our next two Live Q&A Webinars – and get your questions in early to ensure that we can get to them. Looking forward to “seeing” you there!

Microsoft Audits & Licensing: Live Q&A with Miro Consulting

Microsoft licensing expert, Tim Hegedus, will answer audience-submitted questions – from managing compliance and reducing risks to tips on negotiating the best vendor contract. Previous topics covered Miro’s Microsoft event included: The End of XP Support, Negotiating and re-negotiating with Microsoft, Recent licensing changes and their effects on SLAs, Understanding volume licensing programs, Virtualization and licensing, How cloud computing will change the licensing landscape, Switching to Office 365, Software Assurance and what it means for you and SQL Server licensing.

March 11th @ 1:00 PM – 1:30 PM ET

Register here:

Demystifying Oracle Audit & Licensing Complexities: Live Q&A with Miro Consulting

Are you interested in learning more about Oracle licensing? Have questions specific to an Oracle audit? Here’s your chance. For 30 minutes, Oracle licensing expert – Eliot Arlo Colon of Miro Consulting – will answer specific questions on Oracle licensing – from managing compliance, reducing risks, to tips on negotiating the best vendor contract.

Some topics that may be addressed include: changes in licensing, pre-planning for Oracle procurement, concerns over vendor audits, compliance issues, best practices for software asset management and concerns over the changing dynamic environment from mergers and acquisitions (M&A) to divestitures

March 18th @ 1:00 PM ET

Register here:



Jan 25 2013: Published by under software asset management,Software audit

First Oracle, now IBM! IBM is the among the 40 software vendors to be a part of the Business Software Alliance (BSA). Just another reason to be mindful of your software licensing compliance!

Auditing…is Good!

Jan 23 2013: Published by under Compliance,Oracle audit,Oracle license,Oracle Licensing Compliance,software asset management,Software audit

We often refer to software audits as a bad thing… when vendors are knocking down your door and are threatening to fine you. Well, auditing, when YOU are the one doing it, is a positive and effective way to avoid those fines. The best way to find out if you are or are not in compliance, is to audit yourself. Licensing accounts for at least 20% of an IT budget – getting this in order is also a way to save some money (or at minimum be sure that you are efficiently spending that 20%!).

When self-auditing, there is no vendor looking over your shoulder, it can be done with care instead of haste, and will reveal anything you may have to fix should you get audited for real. We recommend self-audits every 6 months, as businesses change so frequently that the way software is being used (and by how many people) is in constant flux.

While self-audits are not easy and they are time consuming they will save the organization in the long run. Audits are on the rise from ALL software vendors and they are auditing businesses of all sizes. Be ready for an audit to avoid heavy fines, and as an added bonus optimize your software licensing spend!

Watch Your Whistle Blowers!

Jan 21 2013: Published by under Compliance,Microsoft Licensing Compliance,Oracle audit,Oracle license,Oracle Licensing Compliance,Software audit

90% of all audit letters sent in 2012 were the result of tips from whistle-blowers, according to the BSA. 90%!!! So those current and former employers that didn’t get the raise they wanted or had a bad day with their boss…they can earn some cash by filling out a simple online form (see below). It’s easy, anonymous and lucrative.

Considering the BSA represents 40 software vendors (including Adobe, Oracle and IBM), it would be pretty easy for any company, large or small, to be caught. Software vendors are auditing more and more and the BSA is just one way for them to find out who they should be targeting.

What is the lesson here? Don’t give whistle blowers any ammo – do a self-audit, get your licensing in order and be prepared!

Audits: Defined

Nov 19 2012: Published by under Software audit

We talk a lot about audits on here, today, we are going to take a moment and define the different types of audits.

Self – often requested by trade associations acting on behalf of software vendors. These are the friendlies of the audits, it is conducted by YOU and results are provided to the vendor.

Independent – This type of audit involves the use of a third part auditor and is the most costly and time consuming. You have virtually no say in the process and must bear the costs of the audit. The only upside is that the auditor is independent, and not an employee of the software vendor.

SAM Engagement – SAM engagements have been used recently by Microsoft, the software vendor requires a third party audit and the results are reported back. The auditor does not need to be independent and the audited company must purchase licenses to become compliant. These audits are typically much less costly as the vendor will forgive past non-compliance with the only cost being the license discrepancy.

Publisher-Staffed – simply said, this should be the last option, if you can avoid it, avoid it! Just as the name implies, this is an audit performed by the software vendor, they collect information and use it as a basis for the dispute. It’s intrusive and one-sided. Best to request a self audit if at all possible.

Any audit is bad news, our advice, get ahead of it!

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