Bill Lard

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Licensing Compliance Sun's Case Study- IACCM
Conference March 18, 2003
Bill Lard Sr. Director, Alliances Technology
Licensing Sun Microsystems, Inc.
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Three ways to acquire technology

• Development in house or through contractors where
  you own it.
• Acquisition of technology through mergers,
  acquisitions or out right technology purchases.
• Technology licensing where you receive less than
  complete ownership rights (e.g., encumbered).

3
Technology licensing requires tracking and
compliance

• Licensing in for integration into products
  requires managing restrictions and encumbrances.
• Licensing out to customers requires managing
  payment obligations (royalties, subscriptions,
  support fees).
• Whether licensing in or out, license renewal
  requirements need to be tracked.

4
Commitment management has its problems.

• Re-organizations or terminations cause loss of
  corporate memory and process break downs.
• Migration of licensed technology to other product
  lines can cause unintended field of use
  violations unless license restrictions move with
  the technology.
• Pass-through royalty obligations need to be
  included in the product price, accounted for, and
  passed through to the upstream licensor.

5
Consistency and efficiency in commitment
management

• Standardize on practices corporate wide wherever
  possible.
• Align policies and procedures where multiple
  functional groups are involved.
• Automate contract creation and commitment
  management to gain efficiencies in developing
  agreements and populating databases accurately.

6
Consistency and efficiency in commitment
management

• (Continued)
• Avoid multiple hands in creating, processing and
  entering data into the system.
• Develop reporting capabilities that advise of
  renewal requirements and customer reporting
  requirements.

7
Managing Technology Creep(i.e., tracking
software licensed in)

• Implement procedures to maintain third party code
  on designated servers with license restrictions
  clearly identified.
• Devise technical solutions to tag software that
  has been licensed in for product development.
• Cross reference your own products to a database
  of third party component software and related
  restrictions.

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In summary

• Good licensing compliance requires accurate
  tracking and reporting with respect to technology
  used and distributed.
• Manual processes are not sustainable and do not
  scale.
• The technology exists to automate most if not all
  tracking and reporting requirements.

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Bill Lard bill.lard_at_sun.com