New or used hardware: Buyer beware

When Buying New Hardware with a Proprietary OS:

· Determine what restrictions exist on software transfer

Ask the manufacturer or reseller about its software-license policy should you decide later to resell the equipment. Be sure to obtain this policy in writing. Manufacturers’ practices and policies fluctuate with market conditions, so you should keep written copies of all software-license policies — including license-agreement language and policy documents posted on the company’s Web site — that were enforced when you first purchased the equipment.

· Negotiate for removal of transfer restrictions

Request that the manufacturer remove any restrictions on transferring software from the agreement and replace the restrictive language with: “Buyer may permanently transfer all rights to use the software as part of a permanent sale or transfer of the hardware,” or words to that effect. Point out that similar language has been standard in license agreements for Microsoft Windows for many years.

When Considering the Purchase of Used Equipment:

· Check Manufacturer’s Policies Before You Buy

Many manufacturers have exceptions to their no-transfer policies, such as when one company acquires all the corporate assets of another. Some also sell their own used equipment complete with software licensing rights, although generally at prices that are higher than those found in the gray market or at Internet auction sites.

· Ask Seller to Supply Software License

Some sellers may not realize they meet exception criteria that allow them to transfer the software. Authorized resellers — even some on eBay — often have the right to sell refurbished equipment with software licensing included as part of the deal.  

· Purchase a Maintenance Agreement

Some companies will waive the software re-licensing requirement if the secondary-market customer agrees to certification and maintenance fees. As continuing support can be particularly valuable with used equipment, a maintenance agreement can turn out to be a real bargain for the customer.