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Recently, a CIO told me his team had just received an unexpected $3 million bill. The cause? Not a major audit or a licence true-up exercise. This unwelcome cost resulted from licensing complications with a small development tool used by only five people in his organisation.
That's what I call "weird" software: commercial products with licensing terms so intricate they catch even the most experienced IT teams by surprise.
In a recent blog, my colleague Allison Hay explored the risks of "free" software (freeware). "Weird" software (weird ware) is similar in its ability to blindside you with a host of unexpected risks and costs. In fact, these paid products can pose an even greater challenge to your IT portfolio management than their freeware counterparts.
Think about all the applications running in your organisation right now. Could you say with absolute certainty how they're licensed? More importantly, could you prove it during a publisher audit?
The truth is, many IT leaders can't. And that's exactly why this matters.
Hidden complexities. Unexpected costs.
"If you're going to fine us $4.5m, we're done. We'll just rip the software out."
That was one CEO's exasperated response when their energy company was confronted with an unexpected software audit bill. When the company initially received the audit letter, they'd expected it would be business as usual.
After all, they'd successfully managed audits from major, tier 1 software publishers. They also had what they considered to be a mature SAM/ITAM programme.
This time it turned out to be very different as the team discovered a piece of software— installed on clustered servers—required twice as many licenses as they'd originally thought, with each of their 300 users suddenly needing two licences instead of one. Worse still, the publisher demanded seven years of back-dated maintenance fees. What started as a "minor" compliance issue escalated into a Board-level crisis.
Their story illustrates what I see as a growing trend. While most IT leaders have robust processes for managing major publishers like Microsoft and Oracle, it's often the less common vendors that present the most complex challenges.
| Challenges of ‘weird’ software | |
|---|---|
| Unclear licensing metrics | Difficult to track and measure usage accurately, especially with staff changes and role transitions |
| Ambiguous language | Essential terms like 'user', 'device', and 'seat' become open to costly misinterpretation |
| Hidden clauses | Unexpected audit requirements and penalties that surface only when publishers initiate compliance checks |
| Cloud migration issues | On-prem licences often can't transfer to cloud environments, creating unexpected costs and delays |
| Poor record-keeping | Difficult to prove compliance or optimise spend when software is purchased outside standard processes |
| Security risks | One-off purchases often lack ongoing security patches and updates, creating vulnerabilities |
| Vendor lock-in | Migration to new solutions becomes increasingly expensive as dependency on specific tools grows |
These challenges and their associated overheads are insidious. When publishers calculate compliance gaps, they frequently include penalties, back maintenance fees, and mandatory upgrades. Even development tools can create significant headaches. One organisation built an internal application using Visual Studio, then published it company-wide—not realising this meant every user needed a $5,000 licence.
The problems compound when business units purchase software independently. A tool that seems inexpensive at first can suddenly require enterprise-wide licensing, creating unexpected costs and compliance risks that impact the entire organisation.
When precision matters most
Many organisations first discover their 'weird' software blind spots during routine procurement reviews. Take the case of a global enterprise whose IT procurement team spotted an unusual licensing invoice. A widely used software platform designed to simplify the development, testing, and management of APIs, the development team had been using this tool productively for months—but no one had assessed the licensing implications or compliance requirements.
This discovery prompted a thorough review of the procurement processes. The team needed to understand how the tool was being used, whether premium licensing tiers were required, and what compliance obligations existed. Coming shortly after an Oracle audit, these questions raised serious concerns about potential business risk.
Fundamentally, this is a question of control. Without precise visibility of the entire software estate, things can go very badly wrong very quickly:
- Technical debt accumulates as quick-fix solutions become permanent
- Innovation suffers when unexpected costs consume modernisation budgets
- Resource allocation becomes reactive rather than strategic
- Security and compliance risks multiply across shadow IT
This is why precision matters in portfolio management.
When organisations gain exact visibility of their software estate, they can make informed decisions about tools and licensing before costs and risks spiral out of control.
Three steps to taking precise control
Managing complex software licensing isn't simply about cutting costs: it's about enabling your organisation to innovate safely and efficiently. The key is establishing precise processes before issues arise, rather than scrambling to fix problems after they surface.
Here are three steps you can take to stay in control of your software estate:
1. Study before you buy
Your first line of defence is thorough evaluation of End User Licence Agreements (EULAs). SoftwareOne's dedicated EULA check service examines every aspect of software agreements, identifying potential risks before they become problems. Our specialists analyse:
- Usage rights and restrictions
- Geographical limitations
- Deployment specifications
- Hidden compliance requirements
- Future-state considerations
2. Centralise your approach
While business units often need autonomy to select tools, maintaining central oversight should be non-negotiable. Successful organisations:
- Create clear procurement channels
- Document all software purchases
- Track deployment and usage
- Monitor compliance status
- Review costs systematically
3. Build in strategic control from the start
Precise portfolio management requires more than just tracking assets. A strategic approach to licensing is an essential building block for establishing and maintaining effective control from the start. That’s why our publisher advisory experts help organisations:
- Assess current software usage patterns
- Review licensing metrics and requirements
- Identify consolidation opportunities
- Plan for future needs
- Negotiate from strength
By integrating practices like these within broader IT Portfolio Management strategies, organisations can gain the visibility and control needed to make confident decisions—including decisions about software with intricate licences.
Looking ahead
Managing complex software licensing situations is set to become more challenging, not less.
Smaller publishers are increasingly assertive about claiming their "piece of the pie" through audits and compliance checks. Even development tools that seem inexpensive initially can create significant financial exposure for large enterprises.
Cloud migration needs add another layer of complexity. Without precise understanding of your licensing terms, moving applications to the cloud can trigger unexpected compliance issues and costs. Publishers who discover unauthorised cloud usage often see it as an opportunity to generate additional revenue.
The message is clear: precise portfolio management isn't optional. It's essential for business success. By working with experienced partners like SoftwareOne, you can transform potential risks into opportunities for optimisation.
It’s a simple choice, really.
Invest in precision for your IT portfolio now. Or pay a premium fixing problems later.
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