Introduction
In the world of technology, legal disputes are not uncommon, especially when it comes to software licensing. A recent court filing that has garnered attention is VMware suing the US subsidiary of technology powerhouse Siemens AG for copyright infringement, as reported by The Register last week. The publisher’s case revolves around allegations of Siemens using unlicensed VMware software, sparking a legal battle with significant implications for software licensing and Software Asset Management (SAM).
Background: Key Software Licensing Issues Between VMware and Siemens
The dispute began when Siemens attempted to arrange extended support for some of its VMware products. Apparently, the company had a clause in its Enterprise License Agreement (ELA) allowing for an additional year’s maintenance and support for “eligible products” at the expiration of the agreement term in September 2024.
Siemens provided a list of products to VMware and demanded the publisher accept a purchase order for maintenance and support services, in accordance with its contractual right. According to VMware, however, when reviewing the list, it discovered it “included a large number of products for which it had no record of Siemens AG purchasing a license” (paragraph 3 of the complaint).
Legal Proceedings
Siemens challenged VMware, threatening legal action for failing to uphold its contractual obligation to provide said support and maintenance, seemingly ignoring VMware’s contention that the list contained products for which Siemens had no right to use, much less obtain support. To avoid disrupting Siemens’ operations, VMware offered support for 30 days “under protest” to allow time to resolve the situation. Siemens, however, later attempted to retract the original product list and offer a new one, which more closely aligned to VMware’s records. According to the publisher, Siemens never provided a credible explanation for the discrepancy and, furthermore, refused to allow VMware to conduct an audit to establish its usage accurately. This led VMware to file a copyright infringement lawsuit in Delaware, where both corporations are headquartered.
The Importance of Communication in Software Licensing
Whilst it is very difficult to form reliable conclusions, based on the limited information available at this stage, it certainly seems like there has been a breakdown in communication internally between Siemens AG’s technology, procurement and software asset management teams. We would go so far as to posit that the original list provided by Siemens was put together based purely on what was deployed, without any reference to those who have the job of managing software licensing and would, most likely, have intervened earlier in the process. The second list was likely submitted to VMware once someone with greater knowledge of the licensing landscape within the company realised the oversight.
To reiterate, this is purely an opinion based on our experiences over the years, but it seems to be the logical conclusion.
Conclusions
The whole case highlights two very important lessons for those working closely with software publishers.
- Make sure you fully understand what is in your software contracts. To submit a list of unlicensed products to a software publisher for which you want support is a serious error which could have been avoided, had the right steps been taken to verify the contracted rights.
- Internal communication is vital to software asset management. SAM is not a single team practice and relies on cross-department collaboration to ensure a fully functional SAM solution, providing the right outcomes for the business.
How bedigital can help
If you need to strengthen your ITAM and SAM strategies, ensure compliance, or need support in dealing with a software publisher renewal or audit, bedigital’s experts can help you. Get in touch with our team to see how we can help you avoid the challenges Siemens is facing today.
