Resell VMS Software Licenses To Another Customer?

I'm sure that this could vary between VMSes and what is stated in the agreement.

We have a client that wants to change his VMS. Is it legal for me to refund his money that he spent on that VMS and resell the license to another client?

You can do it in Hardware, is Software different?


Used software? :) That's a good question.

Sarit, can you forward this to a few VMS companies and see what they respond?

Like you, I assume this depends on the licensing terms which might vary by company.

Sure, I'll let you know what I find out. One thing to note is that most of the VMSes (Avigilon, Exacq, Video Insight, and others) actually tie the activated license to the hardware, so although you can reactivate on the same machine (as long as MAC hasn't changed), if needed, you won't be able to reactivate on a different machine without tech support help.

I will confirm.

Last thing I want is a second hand license. I want my brand new with a high markup. ;)

software loses half it's value as soon as you drive it off the lot...

With Avigilon for example is very easy:

1. Use "License Deactivate" utility

It will generate file

2. Sent file to support ( they will check )

Then they will reactivate on server.

Did with Exacq few times, takes longer but possible.

About other do not know and do not care for now :)

NUUO has self service direct support for this within the activation tool.

Luxriot allows for this via operator assisted deactivation.

As far as I know with the high end versions of Milestone that have a bas server license - the base serve license is not portable but the camera licenses are.

Alex, Bohan, thanks!

Btw, we have a general tutorial on replacing VMS software.

I know from experience you can remove licenses from one avigilon server and install on another... the legality in question is an interesting one...

Nothing illegal to move Lic, u can do it 3 times after talk to support

I am curious about how manufacturers would stop abuse if they allow a license to be used on another machine (i.e., can they monitor / detect if the same license is still being used simultaneously on multiple machines?)

john with avigilon you have to register the channel license either online... if you enter in a license key thay is currently registered on another machine it shows up as an invalid key... I can only assume that when you deactivate the key it may sent an update to avigilon and make the key available again... I believe exacq used to charge for a license move...

Thanks for the feedback everyone. I'm more concerned about the legality rather than the ease of transfer. One VMS said that it's legal only if you move it within then the same organization.

John it will be great if we can reach out to any lawyer members.

Two pieces of information that might help:

Legal Status

The first sale doctrine covers re-selling products:

"Thus, one who buys a copy of a book is entitled to resell it, rent it, give it away, or destroy it. However, the owner of the copy of the book will not be able to make new copies of the book because the first-sale doctrine does not limit copyright owner's reproduction right."

However, software is not sold. Rather, it is licensed, as the Software & Information Industry Association argues:

"Someone who purchases a software license is not the "owner of a particular copy," they are an "owner of a license to use a copy" of the software. Thus, the first sale defense does not apply."

They contend that one needs to check the EULA of the software developer:

"As a result, it is the terms of the software or content license that will control whether the software or content can be transferred and not the first sale defense or any other provision in the copyright law. Accordingly, licensees should consult the license agreement to determine whether the licensed copy may be re-distributed."

This makes sense to me - the VMS company can set whatever terms it wants allowing, constraining or denying re-licensing of their software.

Example - Adobe

Adobe has a pretty clear and detailed license transfer policy. Indeed, eBay emphasizes that buyers and sellers must carefully follow those steps to ensure that 'resold' software is transferred legally.

Conclusion

The bottom line is that it seems clear that this is a decision that each VMS manufacturer can control via its EULA.

Sarit, actually, it would be interesting if you could copy / collect the EULAs for each VMS manufacturer so we could review / compare.

Here are the EULAs:

Milestone: Their EULA states: "(d) You may permanently transfer all of your rights for this product, provided the recipient agrees to the terms of this EULA."

Network Optix: Their response is it can definitely be done, though going through the original dealer is required. However, their EULA (available via installer only and uploaded here for your review) restricts this altogether: "you shall not nor shall you permit any other party to: ...(iv) externally distribute, sublicense, resell, encumber or otherwise transfer the Software...and more"

Video insight: Their EULA states: "TRANSFER. You may move the Software to a different server." notice it does not say a different customer, or ownership.

Avigilon: EULA available via installer only, and it is a bit ambiguous. It reads: "non-transferable license", and "You may not transfer the rights to the Software to a backup copy unless you transfer all rights to the Software granted in accordance with this agreement." and "You may not unbundled or repackage the Software for distribution, transfer or resale." and finally: "You may not rent, lease, sell, sublicense, assign, lend, resell for profit, distribute, network, or transfer the Software or Your rights in the Software, or authorize any portion of the Software to be copied onto another individual or legal entity’s Computer."

Exacq: Eula only available via installer. limited verbiage on "...not transferrable".

Genetec: Genetec says they too tie to mac address, and you must call sales to transfer ownership - which is allowed. The EULA states: "Except as expressly allowed herein no right to recopy, sell, distribute, license, sub-license..."

Also, all of these mfg have a trial/return period, I would think that the length of time used by Customer A (once activated) will also be taken into account if the request is made to transfer ownership of used license to another customer all together.

Sarit, thanks for looking into it. While it appears that it may be allowed, it seems that most give themselves so latitude to reject if they wanted (i.e., the EULA language is vague or constrained). Yes/no?

I would say so, yes. One would think that the EULA is stated in such away to prevent those that attempt to take advantage of the system and it, obviously, protects the mfg in an event such abuse is detected (some systems "dial registration server" to check hardware key during activations). However, especially for integrators, there seems to be some latitude to allow for licenses to be resold and applied to another hardware key/customer.

A few things that would make it difficult:

- Number of times same integrator or End User is transferring

- Length of time before transfer (it is possible for a server to have a replacement NIC card or server is completely replaced due to a disaster). As before- number of times this occurs is taken into account.

I am also curious about the size of the customer. Let's say a Fortune 100 customer with 10,000 licenses tries this. That's quite a lot of money. Would they fight that?

Wouldn't you? :) I bet they would try to implement whatever feature is missing or try to smooth over the situation before letting that customer walk.

This may beloing in another topic, but putting it here for now. My question to all of this is why does the customer not own the VMS license(s)? We own all of ours and they are all in our name. Is that not a normal practice? If it isn't why not?

Good question Ross. The VMS licenses are owned by the customer purchasing them, certainly. However, it is licensed for the intended use, for the company that purchased it, and the server where it was applied only. The gray area is: can you as the licensed owner then resell those licenses to someone else while surrendering all privileges and use once sold>>that's where the EULA's come in to ensure a true transfer is done.

Also, licensing VMSes is not unlike licensing a Microsoft OS product for example, once activated, that product key is assigned to one machine and changing it requires calling their support (I think OS actually allow up to 3 in case of a reformat).

I think we should be careful about using the word 'own' with software. At best, you 'own' a license from the software provider. This is different from me owning, say, a baseball. I am free to resell that baseball or do pretty much what I want with it. By contrast, with software, I am still bound with fairly significant restrictions on what I can do with that.

Right, I get that distinction John. What I am thinking though, that if anyone were able to resell software/licenses, it would be us not the VAR we bought it from? With everything in our name at least that is the way it should be. I had never even thought or considered reselling as even a remote possibility.

Presumably, though, you would sell it to the VAR who would then resell it. The thinking being that they would be better able to find a new buyer as they sell to lots of other users.

Btw, this brings up an idea that might be a winner but certainly would infuriate VMS manufacturers. Create an 'ebay'/market of used VMS licenses. This would help current users migrate and new users find cheaper software.

Of course, one big catch would be the annual maintenance fees. If that was not paid up, the VMS manufacturer could use that to make the new customer pay again to catch up.