Software Audit & Compliance Discussion

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Compliance Discussion

2012 LicensingLive

David Welch

NetApp’s Licensing Czar

Who is NetApp…

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What we sell…

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� Storage Systems (Hardware)

� Storage Operating System

� Storage Management Software

� Support & Professional Services

� Packaged Solutions

Financial Tech GovernmentEnergy

Leaders Are Taking Action

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Information Telco Hosted ServicesHealthcare

Compliance Program… Common view parody

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What could Brian & Stewie, a generic sales rep, Robot Chicken and Sir Lawrence Olivier possibly have in common?

A/V Team - Roll Tape…

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Data Center Design Is Evolving

Application-

Based SilosPublic Cloud

Zones of

VirtualizationPrivate Cloud

Servers

Apps

Network

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A flexible and efficient foundation is essential

Shared IT InfrastructureTraditional Approach

Storage

Audit

Common Terms

Entitlement:

Represents the right by contract or agreement to use a particular software product within

a defined scope of use.

License Agreement:

A contract that sets forth the terms and conditions under which a Licensor grants a

License to a Licensee in exchange for compensation.

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License Key:

An open or cryptic key that enforces software usage compliance within a software product

Compliance Auditing:

The measurement of actual software usage compared to or in accordance with software

Entitlement.

Compliance True-up:

A licensee (customer) compensates licensor (publisher) for software usage beyond the

scope of entitlement as set forth in the license agreement.

Looking for IP Over-usage

� Alignment to entitlement agreement

� Boundaries; region, geo, purpose, time, certification, support plan, etc.

� Programs are built to find over-usage,

Licenses Deployed

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� Programs are built to find over-usage, but shelf ware licenses are an issue too – the scale can tip the other way

Actual Software Usage

Easily a 2-day topic for only 30 minutes

Common Audit Types

None On-Site

� Your program may fall into one of these categories

� Most successful programs leverage a sliding scale of

effort based on risk indicators

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Hig

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ch

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Self-Serv Remote

� Balance risk/reward, but

remember it’s not all about

revenue recovery… Customer insights

Lo

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Hig

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� Potential revenue risk

� Sometimes shocking

what you don’t know

Common Audit Types – double click

None On-Site� Potential relationship risk

� Sometimes no substitute

for being there

� Similar to on-site, but

interviews over phone &

using WebEx or similar

� Sometimes a good

substitute for being there

� Customer self-

compliance certification

� Strong partnership

� Integrate with “phone

home” telemetry

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Self-Serv Remote

Whatever path you choose, it makes sense to keep a “cop on the walk”

Harnessing the opportunity

• Drive revenue through audit settlements and true ups from clients

• Enable sales teams to be active in reaching out for customer up sell activities

Incremental Revenue

Business Insight

Input Creating a holistic compliance Program

Output Realizing value organization wide

Incremental

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A practical licensing compliance program consistent with Company brand promise, company culture and organization wide

participation

• Drive Innovation and improvements to current licensing and pricing

• A proactive sales culture when it come to customer compliance

• Allow for greater insight into key risks by customer base and geography

Business Insight

• Customer attitudes - cooperative, trustworthy etc.

• Affirm 2-way understanding of software usage

Customer Insight

Incremental Revenue

Thoughts to Consider…

� You don’t need to audit everyone and everything

• Pick the IP and contracts that are most critical or at risk

� Consider a statistical audit

• Could build trust with your product integrated IP licensors to reduce product cost or eliminate the need for license keys

� Develop a risk profile and improve it over time with real world data

13NetApp Confidential – Limited Use

� Get help. Many customers prefer a neutral 3rd party like PwC, KPMG, or Anglepoint for onsite/fieldwork

� Integrate findings back to your customer listening program and product development

� And… absolutely adjust your licensing & entitlement models and

license key implementation to more organically work with customer use cases!

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