Staffordshire's Discount Licensing has started a trading scheme
because its business of selling used software licences is running
out of licences to sell, according to co-founder and director Noel
Unwin.
"We have an excess demand scenario, which is a very fortunate
situation to be in for a lot of businesses and hence one of the
reasons why we were looking at this licence trading model," Unwin
told weekly technology podcast OUT-LAW
Radio.
Discount Licensing has been trading for a year, selling used
licences for older versions of Microsoft software and operating
systems to companies that do not need brand new updates. The
company claims to be able to offer discounts of up to 80% on the
list price of the software at its original launch.
"We have a lot of companies that actually are constantly looking
for non-current versions because businesses don't want to be forced
into buying the current version and then be forced into using their
downgrade rights to use a non-current version," said Unwin.
The company has been sourcing licences from companies that have
gone into liquidation. Unwin says that while computers had been
sold off as assets by receivers, nobody had previously thought of
re-selling software licences.
"The idea was how would we be able to realise a value for an
asset that had potentially been unrealised," he said. "Because
nobody knew the licences existed as an asset, it was just being
overlooked."
The business is legal because Microsoft allows a software
licence to be transferred, but it is vulnerable to any change in
the software giant's terms and conditions, as Unwin admits.
"If Microsoft found a way to block a secondary market we would
be in a position where the business would have about four to five
years left of trading," he said. "So we are vulnerable, but not to
the point where it would be a show-stopper from day one."
