No matter what type of intellectual property you need to safeguard in escrow, the software escrow process and steps are more or less the same.
Here are some of the things that need to be considered when entering a software escrow agreement:
- What needs to be held in the deposit
- How frequently that deposit should be updated and,
- What sort of testing must be applied to the deposit to verify its usefulness in case of emergency.
While it may be easy to determine what you need to deposit, understanding the process of verification and deposit management can be a little more tricky.
The software escrow process has everything to do with risk management.
Once the escrow agreement has been concluded and signed, the escrow service provider will call for the deposit of the intellectual property.
Passive escrow
In respect of a software deposit, it is simply not sufficient merely to hold the deposit safely, this is passive escrow.
Active escrow
In order to provide proper protection for the end user, the escrow service provider must actively engage with the deposited material, testing in order to verify the source code deposited by the supplier, by checking it against the various elements of compiled code in production with the end user.
Only then can the escrow service provider assure the end user that they are holding a deposit that would be useful in disaster recovery circumstances.
This is active escrow.
Without Verification Testing, the deposit, and therefore the escrow arrangement, is of very limited value for the parties.
