Who owns the software you’ve paid for?


There can be pitfalls in ordering bespoke software. One is control of the source code of your application. This can be complex. The biggest issue is ongoing support, but there are three issues:


Some software is written in compiled languages, like C++. The programmer writes what is called source code in, say, the C language. This is then compiled into an executable (exe) file. There are other languages. For example, most web applications are written in languages like PHP and Java Script. In these cases the source code is deployed unchanged. In such cases, you should be able to access the source code from your web server. However, some web sites are generated by software like Adobe. You may find in these cases that you do not have access to the source code and the site can only be changed by the holder of the source code.

Support and maintenance

This often causes major problems. You commission some software, install it, sign it off and pay for it. You then find the software house charges high fees for any extra work on the application. Many software houses adopt this approach. Others consider it to be unethical.

The worst problems occur after disagreements. If you fall out with the supplier, and this happens far too often, you will be stuck. You may have to order new software. Even taking data from the old software can be difficult.

To overcome this, the contract should clearly state that the software company must make the source code available to you, or at least to a third party. It must also state that the source code must be handed to the client at the end of contract.


This will only normally arise if you or the software company decides to sell your application as a package. The legal issues are complex, but, in the absence of a clear agreement, it is quite likely that the software house would own the copyright of the source code.

If there is any possibility that you would want to market the software, this should be discussed before the contract is signed. In fact, many software houses (including McMillan) would be very happy to collaborate with you in marketing a package. This needs to be made clear at the outset.

But what about the software house using parts of the code in other contracts? In reality it will be difficult to stop this, and in any case you would be unlikely to be able to profit if that did happen. It does help to check before agreeing to the order.


Software houses do sometimes go out of business. If this happens and you don’t have access to the source code, you will be in trouble. Escrow agreements are common, and state that an up to date copy of the source code must be deposited with a third party.

Some care needs to be taken in drafting the terms of the escrow agreement. By default, the source would probably only be released following the commercial failure of the supplier. The author’s view is that it should be released at the end of contract.

Summary: useful contract clauses

Apart from normal terms and conditions, the contract should:

  • Define the copyright
  • State that at the end of a maintenance agreement, you will have full access to the source code.
  • If the supplier is not prepared to deliver the source code to you, insist that an escrow copy is deposited with a third party. Also insist that you have the right to access this at the end of a maintenance agreement.

Problems are more likely to occur with larger software houses. Smaller ones need to be more flexible and they will need you as much as you need them. So negotiation will be simpler and you won’t need anything like as much access to lawyers.

About the author

John McMillan is a software developer based on the Essex Suffolk border in England, close to Cambridge and North East London. He writes business programs to order, his applications have carried out many business functions.

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Are spreadsheets and office tools the best way?

Firstly, spreadsheets are a generic tool. They can provide basic reporting but do have major limitations. For example, applications built around spreadsheets are rarely easy to use.

Spreadsheets will normally be the best way to provide a one-off solution but they are not usually convenient to use. For any application that has to be run regularly they are not an efficient solution. They are also very error prone (see below).

The staff costs in using a spreadsheet do need to be balanced against the cost of bespoke software. In the long term, a bespoke solution will almost always be better value. It may cost more initially but the costs will be recovered over time.

Spreadsheets are error prone

A year or so ago, I advised a software company who are spreadsheet experts. It was interesting to say the least. Studies from academics and the European Spreadsheets Risks Interest Group (http://www.eusprig.org/) have found that most spreadsheets contain at least one error. Problems occur when rows are inserted or deleted and formulae are not adjusted properly. How do you check the results of a spreadsheet calculation? One man told me he checks by adding up the column with a calculator. You have to wonder about the point.

And …

Your staff are not IT experts. They will take longer to develop a solution than the professionals will. They often don’t know what can be achieved so won’t come up with the best solutions.

And while staff are developing apps, they are not doing the job they are paid to do.


Using Web Technology to Provide Low Cost Business Software

Spreadsheets have transformed business. But there are limitations in what spreadsheets can provide. Once the limits of spreadsheets are reached, database solutions are needed. (See my blog What is a Database) . Most business applications, whether bespoke or off-the-shelf, are based around some form of database.

Recently, some software developers have found that web technology can be used to make bespoke database applications much more affordable and usable.

Windows has many advantages and is nearly universal on PCs but it suffers from poor database support. In fact, Windows is really designed for applications like word processors and spreadsheets. There have never really been any standards for providing Windows database apps. The solutions that exist have tended to veer between the very expensive and inelegant. The solutions are rarely easy to set up and they often place many restrictions on the layouts of forms. The lower priced ones are difficult and expensive to maintain.

However, the software to create web sites has become very standard and sophisticated. The software components work well, and many are open source with minimal or no licence charges. Some developers have realised that it is now easy to build business apps around intranets. These reside on the user’s server and are accessed through the browser.

Using intranets to provide apps provides many benefits.

No deployment costs

You only pay for the development, not licences for a database engine

Ease of deployment

Traditionally, database drivers have had to be installed on every workstation. All that is needed to use the software from a new PC is to type the app’s address into the browser.

And, of course, everybody knows how to use a browser.

Wide availability of resources (skills)

Web software, especially the PHP programming language and the MySQL database engine are popular with developers and there are large numbers of developers available. This reduces being tied to one supplier.

Future proof

Web technology is here to stay. The environment is stable and suppliers are committed to the future. Standards are not controlled by users, not companies.

Low cost

Cost of development can be significantly cheaper than traditional methods.