A wide field needs to be structured: At this point you will find information on products, services and technical terms of the world of software remarketing.

Audit
COA
Copyright
Copyright law (UrhG)
Deficit licensing
Direct license
Downgrade
Download software
EULA (End User License Agreement)
Exhaustion of rights (§ 69c Nr. 3 Satz 2 UrhG)
FPP
Intellectual property
OEM-software
Over licensing
Pre-owned software
Proper transfer of licenses
PUR - Product Use Rights
Remarketing
Right of use of software
Single license
Software Asset Management (SAM)
Software Asset Management-Tools (SAM-Tools)
Software license
System builder license
Transfer of licenses
Under licensing
Volume license

Audit
In economy auditing is understood as a check-up of internal activities having the aim to get verifications for it. In information technologies and especially in the industrial sector of software, audits describe the check-up in line with licensing. In this way it is controlled if the used software is licensed sufficiently. It is doubtful if the manufacturer have a judicial permission for this kind of check-up.

COA

COA is the acronym for Certificate of Authenticity meaning FPP and OEM software. The sticker is often positioned at the computer or at the packaging of the product.

Copyright
Copyright describes the protection of a creation for its originator. The basic idea is the observing of the interests of the originator. His productivity is supposed to be protected and honoured adequately. Traditionally compositions, paintings, sculptures or texts were rated as creations that deserve protection.

Based on a EU guideline from 1991 the copyright for computer programmes was converted to German right (§69 UrhG). Thus computer programmes are protected copyrighted material since June 1993. In Germany software is classified as protected goods equal before the law as literature, art or science.

By these judicial basic regulations the right holder gets the protection of his intellectual creation he is entitled to. He is enabled to decide on the first publication, first sale and copying of his creations. Appropriate to the principle of exhaustion of the right, which is relevant for software also because of the EU guideline of 1991, the right of the originator to control the sale of the ongoing dealings of creations after the first deliberate sale expires.

Copyright law (UrhG)
Copyright

Deficit licensing
In line with software planning there is to consider a series of variables. This means different license and care models or the different versions of single products. These complex structures often lead to under licensing or over licensing. The relative situation is often uncovered by SAM (Software Asset Management) projects or audits. Relief can be achieved by the acquirement of pre-owned software with which a cheap standardisation is possible. Generally unused software can be resold if these are bought products but not rent products and leads to an improvement of liquidity.

Direct license
Direct licenses are a special form of licenses, which can be acquired directly from the producer or from the distribution partner. Basically there is no difference in the use of pre-owned software licenses and direct software licenses. From there regarding compliance the usage of pre-owned software licenses is equivalent to the usage of direct licenses.

Downgrade
In case of acquiring a new version of a software product but using an older version of the same software product (parent version) the process is called downgrade. Standardisation to one version decreases IT costs and is a possible reason for this instance. First of all products of volume licenses and licenses for operating systems can be downgraded.

Download software
Software products are called download software when they were acquired via downloading. Within this process the user gets a license key for activating the installed software. If software delivered by download is allowed to be resold without the agreement of the producer, as it is usual for software based on a data medium, is disputable at the moment. preo advises the user to order the data medium together with every achieved software product because in this case the exhaustion of the right of distribution becomes relevant and accordingly the products can be resold without agreement of the producer.

EULA (End User License Agreement)
A EULA is a license agreement where the software manufacturer adjusts the rights of use of a software product.

Exhaustion of rights (§ 69c Nr. 3 Satz 2 UrhG)
The principle of exhaustion means that the distribution right of a producer exhausts when used copies of a computer programme were put into circulation once by the agreement of the holder of the proprietary right. Accordingly the producer does not have influence on the circulation of the software on the market any longer. If exhaustion becomes relevant concerning download software is controversial at the moment.

FPP
FPP is the acronym for Full Package Product. It is a question of a single data medium of software as the customer can buy on the market. Generally these single packages combine the data medium and the documentation in one package (software box). As a basic principle it is allowed to install this software on only one single computer (single license). Reselling is permitted.

Intellectual property
Copyright

OEM - Software
Original Equipment Manufacturer
OEM software means programmes for basic equipment of computers that are sold together with a new computer for a cheap price. Consequently the customer pays less by the initial purchase of a computer including a pre-installed OEM version as if he buys the same computer and a common selling version of the same software separately. These software licenses are combined with limited rights of use if applicable. Generally OEM software contains a data medium, the certificate of authenticity COA including a product key and a small manual if necessary.

Over licensing
Over licensing is a form of deficit licensing where the company owns too many licenses ignoring the actual demand.

Pre-owned software
Pre-owned software is such, which already had been resold by the manufacturer and accordingly a trade partner to a company. The “previous owner” does not – or not anymore – use these licenses and this is why they are sold. In contrast to direct licenses used licenses are not acquired directly from the manufacturer or one of his servants but generally from a specialized dealer. This dealer organises the transfer from the salesperson to the acquirer and informs the original software manufacturer of this process. Because of the fact that software cannot wear off the term „used“ does not mean the status of software but merely that a previous owner already owned it and accordingly used it. This software is as good as new software.

Proper transfer of licenses
The seller, the acquirer and the dealer have to assure the proper transfer of licenses and the permitted use of the software licenses while resale of pre-owned software. The proper transfer of licenses is to achieve only by transparent communication between all of the involved parties. The seller of the licenses has to prove the origin and by that the chain of rights of the licenses to be transferred completely. The acquirer is responsible for the completeness of the transferred license certificates. The dealer acts as an interface between seller, acquirer and software manufacturer. The procedure of preo Software AG has established on the market as “best practice” because preo comes with the expertise necessary for the communication with software manufacturers. In this way the proper course of action of the license transfer is secured.

Remarketing
The term remarketing means the selling and the marketing of pre-owned articles as for example IT hardware, production machines or now software licenses. The possibility of reselling redundant licenses in line with a process called software remarketing exists for a few years. In particular the industry and the trade market have released not needed licenses increasingly during the last three to four years and highly disburdened their IT budgets thereby. That is why it is not rare that user can finance up to 50 percent of a license project by marketing their not needed licenses.

Right of use of software
While a customer acquires software he gets specific rights of use for it. The buyer acquires a copy of the computer programme. The appropriate contracts include detailed regulations of copyright and they arrange in which complexity the software can be employed by the single user and accordingly by the company.

Single license
In case of a single license it is allowed to install and use the purchased software only on one single PC contrary to volume licenses.

Software Asset Management (SAM)
By software asset management it is meant a bundle of different business processes by its help the software asset of a company is administered and controlled. Software asset management-tools support the process-orientated course of action.

Software Asset Management-Tools (SAM-Tools)
Software asset management-tools support administration and inventory of software and licenses in stock of a company. With this approach the equipment and the number of licenses are counted and compared with each other. The outcome is almost always the identification of unused as well as needed software and with this the recapitalisation of unused software and accordingly the cheap acquisition of pre-owned software.

Software license
By a software license (OEM, volume license) the user gets the right to install a software programme and use it. The main part of the software is bought currently. Because of that with every software programme, which is installed, a software license is essentially needed.

System builder license
System builder licenses are single licenses, which are sold by authorised middlemen to system builder. The products are often cheaper than FPP and they are generally offered in a bundle together with hardware.

Transfer of licenses
Proper transfer of licenses

Under licensing
Under licensing is a form of deficit licensing where a company does not own the actual needed number of licenses. Under licensing includes always a judicial risk.

Volume license
Contrary to single licenses in case of volume licenses the user gets a bigger number of licenses and is allowed to install and use the software on multiple computers. Generally at least one data medium is committed that is, concerning the regulations of the license contract, permitted to be used to install the software – the user gets the right to prepare an appropriate number of copies of the software.