No, this is not about hacking, but rather about the viability of the company that supplies your software. Outlaw.com looks at some of the options you might consider.  Software escrow can serve as credit crunch insurance.

Companies are being urged to implement software escrow agreements as more and more firms go bust. One legal expert said that companies should go further and assess their whole software supply chain to protect against the effects of the downturn.

Software escrow agreements are signed between the supplier and buyer. They place the software's source code in neutral storage and the buyer of the software gains access to the code under pre-agreed circumstances. One of those is almost always the failure of the software supplier's business.

That protects the buying company because it can continue to use and update the software even if the supplying firm is not around to provide the support that was agreed in the original contract.

NCC is a supplier of escrow services, and it said that companies should be putting escrow in place now more than ever.

While the news is full of baniking and car makers and airlines in trouble, the ICT sector is also in trouble

"We are already seeing the devastating effect of the recession as it hits the UK’s high streets. The potential for software companies to declare bankruptcy is very evident in the media at the moment," said Jon Leigh of NCC. "We are urging companies – especially those reliant on using or delivering bespoke or tailored software – to carry out an escrow audit as part of their best practice procedure to identify the applications most at risk. This will enable them to protect themselves and their customers if the worst does happen."

"If you have business-critical software which requires maintenance you need to put contingency planning in on how you are going to get the developers from that company that has gone bust to help you," he said. "Over-dependence on potentially weak software supply is what escrow highlights. Stage one is to get the source code back, but stage two is where you have to get the people to look after it."

The NCC said that the problem of how to secure access to software after a supplier goes bust was becoming increasingly pressing.

[...] "According to statistics released by the UK Insolvency Service there has been a 129% increase in the number of businesses in the IT sector in England and Wales going into administration in the final quarter of 2008," said an NCC statement. "Over the first quarter of 2009, this number is expected to rise even high

One response has been to tend towards bigger companies as suppliers, but in a world where General Motors is effectively bankrupt, all bets may be off.

Is this the perfect case for Open Source software? How well is your organisation set up to manage its own coders to care for your customsed systems?

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