Open Source Software License Due Diligence

What is Open Source Software License Due Diligence?

Often, commercial software contains open source components. In the due diligence for acquiring a commercial software company, you have to check if the company complies with the licenses for open source software contained in their products (open source due diligence). The following figure shows typical components of commercial software that are analyzed during due diligence.

They are coming from service providers, from suppliers for OEM software, freeware and open source software and they are created by employees, too.



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Utilization of open source software

Next in due diligence we look at the utilization of open source software. In the following figure the software vendor distributes the software products to resellers and to direct customers. The key fact that triggers open source license compliance is often distribution.


WIth the distribution, the open source license terms apply and have to be complied with. Often open source license terms require that the source code is revealed and/or the software has to be provided free of charge. This is of course a critical issue in the due diligence of commercial software.


Summary

Software vendorsĀ“ core business is monetization of usage rights granted to customers. Open source software and corresponding licenses have to be diligently analyzed in open source due diligence.

You have to ensure that

  • all current and planned utilizations of open source software are covered and that

  • no open source license terms are violated.

For more details, please consider the following book:

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Title: Open Source best practices

Editor: Karl Michael Popp

ISBN: 3738619096

Publisher: Books on demand

Date published:


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Title: Mergers and Acquisitions in the software industry - Foundations of due diligence

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ISBN: 3732243818

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