Software Asset License Management (SAM, SLM) License Audits

Dear JDisc friends,
I guess most of you agree that software license management (SLM), software asset management (SAM) and software audits are hot topic nowadays. Organizations are constantly under the threat of software audits. At the same time, there’s a significant opportunity to reduce licensing and support costs for software that is no longer in use.

Some of our competitors in the network inventory discovery space have jumped on the SLM train, claiming to offer software license management. So why aren’t we doing the same?

Software License and Asset Management (SLM, SAM) is more complex than it seems!

At first glance, software asset management (SAM) might appear straightforward. Many people think of it in terms of simple per-device or per-user licenses, such as Microsoft Office, where one installation typically requires one license. In such cases, license management seems easy: count the installations, compare them with purchased licenses, and determine whether you are over- or under-licensed.

However, enterprise software vendors like Oracle, SAP, Microsoft, IBM, and Adobe have developed highly complex licensing models. Licensing may be based on various factors, such as:

• The number of concurrent users
• The hardware specifications on which the software is running (e.g., CPU cores, RAM, or processor type)
• The geographical region or business unit using the software
• The cloud vs. on-premises deployment model
• The combination of software products (some licenses include or exclude features depending on the software suite)

To make things even more complicated, software vendors frequently change licensing terms, requiring organizations to constantly adapt. Keeping up with these changes is a full-time job, often requiring expert knowledge and dedicated tools.

Experienced Software License Management Specialists exist for a Reason!

Enterprise software is often one of the most significant IT expenses for a company. This is why dedicated software license management companies and consultants exist. They specialize in a handful of major vendors, offering deep insights into complex licensing models and helping organizations optimize their software costs.

These experts can often help companies save significant amounts of money by identifying unused or underutilized licenses, negotiating better terms with software vendors, and ensuring compliance with licensing agreements.

However, many of these consulting firms lack a robust discovery mechanism for detecting software usage across an organization. Instead, they rely on self-written scripts or manually collected data, which is often incomplete or difficult to deploy.

The JDisc Approach: Cooperation with Software Asset Management Specialists instead of reinventing the Wheel

So, what is JDisc doing with respect to software license management? Our strategy is to cooperate with specialized SLM software and consulting firms rather than trying to build a fully-fledged license management tool ourselves.

JDisc Discovery provides a powerful network inventory solution that accurately scans hardware and installed software across an organization. We deliver precise and reliable raw data, which license specialists can import into their license management tools to conduct compliance checks, cost optimizations, and audits.

Software Audits: A Risk That Cannot Be Ignored

One of the biggest challenges in software license management is the software audit process. Major software vendors like Oracle, Microsoft, Adobe, IBM, and SAP regularly audit their enterprise customers to ensure compliance with licensing agreements. These audits can be triggered by various factors, including:

• Changes in software usage patterns
• Mergers and acquisitions
• Vendor suspicion of non-compliance
• Random selection as part of routine vendor compliance programs

The Risks of Being Over- or Under-Licensed

A failed software audit can result in significant financial penalties, often running into millions of dollars for large enterprises. If a company is found to be underlicensed—meaning it has more software installations than purchased licenses—it may have to pay backdated licensing fees, fines, or even legal penalties.

On the other hand, being overlicensed is also a problem. Many companies buy more licenses than they actually need, wasting substantial amounts of money every year. In some cases, organizations continue to pay for software they no longer use, simply because they lack the visibility to track usage effectively.

This is where our IP Scanner JDisc Discovery plays a crucial role. By providing accurate and up-to-date inventory data, we help organizations ensure that their license management specialists have the necessary insights to avoid both over- and underlicensing scenarios.

Software Asset Management – Conclusion

If you are thinking about introducing a software license management product, first check whether the software of choice fully supports the vendors and licensing models relevant to your business—especially for expensive enterprise software.

The ITAM Review provides valuable resources on software license management, including best practices, tool comparisons, and industry insights.

By leveraging JDisc Discovery as a foundational inventory solution, companies can ensure that they have precise and up-to-date software data, which can be used by license management specialists to optimize costs, ensure compliance, and prepare software audits.

See ya,
Thomas