Feeds

Software company says it can still resell Microsoft licences

Despite attempts to stop the practice

Intelligent flash storage arrays

The founder of a company set up to re-sell Microsoft software licences claims he will still be able to do so, despite changes made by Microsoft to its software licences which appear to be designed to stop the re-sale.

Discount-Licensing.com has been in business since 2005 and buys used licences, often from company liquidations, and re-sells them to other companies.

In September of last year, though, Microsoft changed the terms of licences in its small and medium sized company licensing scheme, the Open scheme, and its large organisation scheme, called Select.

The Open licences now say that "the resale of Licenses is expressly prohibited", while the Select scheme orders that customers do not engage in "transferring licences for resale to unaffiliated third parties".

Noel Unwin of Discount Licensing says his firm is still able to facilitate re-sale while staying within Microsoft's licensing terms.

Unwin said the new Open licence terms now prohibit the resale of licences, but do not stop Discount Licensing from acting as a broker between a selling and a buying company.

"Though it restricts the way you can buy and transfer pre-owned licence agreements it doesn't prohibit the re-sale of Open licence agreements," he said.

"The terminology in the notice of transfer and the licence agreement said you're not allowed to resell the licences on to a third party for resale," said Unwin. "In other words, we couldn't buy the licences from an insolvency practitioner and then sell them on. However it is perfectly legal to organise the transfer and sale of an Open licence agreement from an insolvent company directly to a private sector company and take a commission just like any broker would."[7.36]

For Select licences, which are designed for very large organisations of hundreds or thousands of users, Discount Licensing has devised a process by which a shelf company is sold from the licence holder to the organisation that wants to buy the licences. He says this creates a situation in which licences can be transferred without breaking the terms of the licences.

"You can transfer the licences, or reassign a certain number of licences, within the Select agreement just in connection with the divestiture of the affiliate," said Unwin. "So what we do is create the affiliate or shelf company for the supplier, we create the sale using our sales contract, sell the shelf company and then we can effect the transfer of the Select licences directly from the supplier to the end customer."

OUT-LAW.COM sought a response from Microsoft about whether it thinks that the processes are compliant with its licences but the company did not respond. OUT-LAW.COM has seen an email from Microsoft's legal department to Discount Licensing, though, which neither accepts nor rejects the processes.

Copyright © 2008, OUT-LAW.com

OUT-LAW.COM is part of international law firm Pinsent Masons.

Internet Security Threat Report 2014

More from The Register

next story
Spies, avert eyes! Tim Berners-Lee demands a UK digital bill of rights
Lobbies tetchy MPs 'to end indiscriminate online surveillance'
How the FLAC do I tell MP3s from lossless audio?
Can you hear the difference? Can anyone?
Inequality increasing? BOLLOCKS! You heard me: 'Screw the 1%'
There's morality and then there's economics ...
Google hits back at 'Dear Rupert' over search dominance claims
Choc Factory sniffs: 'We're not pirate-lovers - also, you publish The Sun'
While you queued for an iPhone 6, Apple's Cook sold shares worth $35m
Right before the stock took a 3.8% dive amid bent and broken mobe drama
4chan outraged by Emma Watson nudie photo leak SCAM
In the immortal words of Shaggy, it wasn't me us ... amirite?
prev story

Whitepapers

Providing a secure and efficient Helpdesk
A single remote control platform for user support is be key to providing an efficient helpdesk. Retain full control over the way in which screen and keystroke data is transmitted.
Intelligent flash storage arrays
Tegile Intelligent Storage Arrays with IntelliFlash helps IT boost storage utilization and effciency while delivering unmatched storage savings and performance.
Beginner's guide to SSL certificates
De-mystify the technology involved and give you the information you need to make the best decision when considering your online security options.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.
Secure remote control for conventional and virtual desktops
Balancing user privacy and privileged access, in accordance with compliance frameworks and legislation. Evaluating any potential remote control choice.