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The Importance of Software Escrow to Business Companies

The computer is one of the most flexible, useful and the most popularly bought modern devices all over the world, and it is designed to function by allowing the user to instruct this certain device to carry out automatically, sets of arithmetic and logical operations. The two basic parts of the computer device are the hardware which is the part of the computer that are physical in form, and examples for these includes graphic cards, sound cards, memory or RAM, motherboard, displays, cables, keyboards, printers, mouse, power supplies, circuits and computer chips; and the software such as data, programs, encoded information or computer instructions, libraries and protocols that do not have a material or physical form. Source code is an example of a computer software, and it is any collection of computer instructions written using an ordinary text or a human-readable programming language and it is designed to facilitate the work of the computer programmers.

There are a lot of software developer companies all over the world, and they are mostly making use of the source code in order to maintain and operate their products to their customers, however, in this kind of business industry, it can be very critical and demanding, specifically when their partners or the licensors were not able to comply on their work duties, and this may be due to different reasons, such as acquisition, bankruptcy, obsolescence and merger. Each and every business owners of software developer companies have the common desire of ensuring that the software products that they have created for their customers will still continue to operate and that can only be achieved by having a copy of the recent and up-to-date source code of the product, and the solution for this is through the use of a source code agreement contracts. Source code escrow is also called as software escrow, and it is a way of lightening or mitigating any risk to happen when two or more parties negotiate for the license of the software application, and once these developer companies will create their contract of software escrow, the source code will be placed in a secured account handled by a trusted escrow agent, who acts as the third party. The various agreements involved during the process of achieving a source code escrow includes specifying the scope and the subject of escrow; circumscribing the rights obtained by the licensee with respect to the source code after the software is released; providing the fees of the escrow agent for his efficient services; providing non-compete clauses in the agreement of license; specifying the services provided by the escrow agent; specifying the conditions that must be met by the agent to release and give the source code to the licensee; and obliging the licensor to place or put updated or the recent versions of the software in escrow in specific period of time. The software developer companies who wants to obtain more accurate information about software escrow and wants to hire the services of the best escrow agent in their local area can look for them through the recommendations and word of mouth of families, colleagues and lawyers, or through the use of the internet.